-
Dec 17, 2025
-
Income tax refund with wrong claims: Up to 200% penalty, criminal action for wrong tax refund claim; check exactly what will happen
The Income Tax Department has uncovered a network of agents who facilitated the filing of income tax returns with fraudulent deductions and exemptions, enabling taxpayers to unlawfully lower their tax liability and secure illegitimate refunds.
According to an Income Tax Department statement, investigations revealed that some intermediaries had created pan-India agent networks that filed returns on a commission basis by inflating or fabricating deductions under the Income Tax Act. A large number of these bogus claims were linked to donations made to Registered Unrecognised Political Parties (RUPPs) and certain charitable institutions, as per the Income Tax Department.
What does Income Tax Department's action against such offenders mean?
"Recent CBDT advisories reflect a clear policy intent to curb artificial tax planning and deter bogus claims through an integrated approach combining advanced data analytics, third-party verification, and stringent penal measures," says Sandeep Bhalla, Partner, Dhruva Advisors.
|