The Income Tax Department has said that people with joint bank account or involved jointly in property transaction can eliminate the fear of scrutiny by using the feedback mechanism in Annual Information Statement (AIS). It also clarified that miniscule number of returns are picked up for scrutiny.
AIS was introduced last November. As soon as it becomes fully operational, it will replace Form 26AS . It has information not just about tax paid and income received but also includes additional information relating to interest, dividend, securities transactions, mutual fund transactions, foreign remittance information or even payment made for credit card.
“Just because of mismatch, case will not be picked up scrutiny,” a senior tax official told BusinessLine while adding that such apprehension is unwarranted. Further, he added that there is also provision to file updated return. Enough tools are available to rectify the mismatch. “Nothing adverse will be initiated without any detailed explanation from the assessee,” he said.
How the feedback mechanism works
These responses have been made at a time when certain section of assessees have expressed apprehension in some specific situation. For example, when a property is owned jointly and if it is disposed, the sale consideration is reported for each PAN (Permanent Account Number) related with individuals who jointly own the property. The official explained that in such a situation, once it is reported in AIS, the assessee can mention in the feedback before filing the return that he owns certain percentage of the property only. Accordingly, he can calculate the capital gain tax, pay and mention in the return.
Similarly, in case of joint bank accounts, interest will be intimated against the name of each of the individual. There, the person again can use the feedback mechanism to intimate that the account is joint one. This means, tax liability will be shared. Another example is gifting of share, etc through off market deal to wife, daughter or son. AIS will show as sale in the name of giver. Here, the giver can mention as gift in the feedback.
AIS can be accessed through new income tax e-filing portal. (https://www.incometax.gov.in). If the taxpayer feels that the information is incorrect, relates to other person/year, duplicate, etc, a facility has been provided to submit online feedback. Feedback can also be furnished by submitting multiple information in bulk. An AIS Utility has also been provided for taxpayers to view AIS and upload feedback in offline manner. The reported value and value after feedback will be shown separately in the AIS.
A simplified Taxpayer Information Summary (TIS) is also generated for each taxpayer which shows aggregated value for the taxpayer for ease of filing return. TIS shows the processed value (i.e. the value generated after de-duplication of information based on pre-defined rules) and derived value (i.e. the value derived after considering the taxpayer feedback and processed value). If the taxpayer submits feedback on AIS, the derived information in TIS will be automatically updated in real time. The derived information in TIS will be used for pre-filling of Return (pre-filling will be enabled in a phased manner).
In case there is a variation between the TDS/TCS information or the details of tax paid as displayed in Form 26AS on TRACES portal and the TDS/TCS information or the information relating to tax payment as displayed in AIS on Compliance Portal, the taxpayer may rely on the information displayed on TRACES portal for the purpose of filing of ITR and for other tax compliance purposes.