The new CBDT (Central Bureau of Direct Taxes) rules on IT raids have the potential to make them even more frequent, but they also expose the Income Tax Department to more lawsuits. This is because the rules have relaxed the conditions under which a raid can be conducted, and have also given the department more powers during the raid.
The new rules allow the IT department to conduct a raid if it has "credible information" that a person has undisclosed income. This is a lower threshold than the previous requirement, which was that the department had to have "reason to believe" that a person had undisclosed income.
The new rules also give the IT department more powers during a raid. For example, they can now break open locks and seize documents and assets without a warrant. This could lead to the department seizing assets that do not belong to the taxpayer, or that are not related to any tax evasion.
The increased frequency and powers of IT raids could have a significant impact on the common man. If the department conducts a raid on a taxpayer's premises, it can disrupt their business and personal life. The taxpayer may also be subjected to harassment and intimidation by the IT officials.
If a taxpayer is subjected to an IT raid, they should take the following steps:
- Cooperate with the IT officials, but do not make any statements without legal advice.
- Retain copies of all documents and records that are seized by the IT officials.
- Get legal advice from a qualified lawyer.
The taxpayer may also file a lawsuit against the IT department if they believe that their rights have been violated.
It is important to note that the new CBDT rules are still in their early stages, and it is not yet clear how they will be implemented in practice. However, the potential for more frequent and intrusive IT raids is a cause for concern for the common man. If you are ever subjected to an IT raid, it is important to know your rights and to seek legal advice.
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