Comptroller and Auditor General of India (CAG) has asked the Central Board of Direct Taxes (CBDT) to effectively use the mechanism of survey, searches and seizures to widen the tax base in cooperative sector/cooperative banks.
In its performance audit report on assessment of cooperative societies and cooperative banks tabled in Parliament on Wednesday, CAG has highlighted that the proportion of surveys and search and seizure operations against cooperative sector as compared with such searches by the Income Tax Department is minimal. Thus it is evident that the mechanism of surveys and search and seizures operations has not been utilised effectively by the I-T department to identify tax defaulters/potential assesses in the cooperative sector (except one year) despite a large number of cases being out of the tax net, the CAG has said.
“Survey may be utilised to identify cooperative societies/banks still outside the tax net and bring them within the tax net”, the CAG report recommended.
CBDT has also recommended that appropriate action as per provision of income tax law be initiated against non filers/stop filers in cooperative sector.
The cooperative sector witnessed a significant growth in terms of number of entities registered as cooperative societies and cooperative banks. During 2009-10 to 2016-17, cooperative societies registered a growth of 39.84 per cent.