IT COULD be a matter of time before the incometax department swings into action against Satyam Computer Services. It is reliably learnt that the investigation wing of the income-tax department has completed a thorough inquiry into the Satyam Computer Services fiasco. The report, according to an official close to the development, is expected to be submitted to NB Singh, chairman, Central Board of Direct Taxation (CBDT), on Friday. CBDT, the apex body of tax administration in the country, is expected to give directions to its investigation wing on the course of action it should take, after assessing the inquiry report. However, upon being queried whether the department was planning to attach Satyam's assets, JR Sharma, director general investigation, income-tax , Hyderabad, said "We have no such plans so far. However, I cannot comment any further on this matter as it falls within the ambit of the CBDT." It is also learnt that there is a blanket ban on I-T officials from speaking to the media on matters related to Satyam. While the end result of the inquiry could not be ascertained, it is understood that part of the I-T probe focused on the genuineness of tax exemptions claimed by Satyam under section 10 A of Income-tax Act, accorded to Software Technology Parks. There were also reports that the Hyderabad Income-tax department had noticed anomalies in the returns submitted by the company to the department as early as financial year '02-03, but could not take any action since those irregularities fell beyond the purview of the department whose powers are limited to protecting the taxes due to it. Unlike its counterparts in the UK and the US, Inland Revenue Service and Internal Revenue Service respectively, the I-T department does not possess the power to arrest. However, the investigation wing of the department is vested with powers to carry out raids on business houses or individuals if there are sufficient grounds to suspect that income has escaped taxation. The department can seize documents and assets of tax evaders, freeze bank accounts and lockers and levy a penalty up to 100% of the concealed income. I-T has played a crucial part of the central government's investigations into major scams, including the 1992 securities scam that did the then stock broker Harshad Mehta in. The department raised a tax demand of Rs 20,000 crore, which included interest and penalties on the unpaid tax, on the main accused and on members of the Harshad Mehta group. – www.economictimes.indiatimes.com
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