I-T may unleash power to arrest to retrieve big tax arrears

The Income Tax Department is all set to crack the whip on tax defaulters by invoking its power, which has not been used for many years, to arrest and prosecute evaders.

The step comes in the backdrop of the government initiating various steps to curb generation of black money in the country and also recently notifying the creation of the first-ever Criminal Investigation (CI) unit in the I-T Department.

The I-T Department, through its Tax Recovery Officer (TRO), has been bestowed with the powers to "arrest and detain" in prison a tax defaulter and carry out subsequent stringent penal action against the individual under the provisions of the Income Tax Act to recover arrears.

The TRO''s office and its powers have been "dysfunctional" for a long time now, but rising tax arrears and economic crimes have made the I-T Department revive and restore the powers and functioning of this unit, which is deputed under every Commissioner of Income Tax (CIT) in the country.

"The jurisdiction of the TRO begins when an assessee is in default or is deemed to be in default in making payment of tax," the I-T Act stipulates.

"A TRO is empowered to attach and sell assessee''s movable property and immovable property, arrest the assessee and detain him or her in prison and appoint a receiver for the management of this movable and immovable property under Section 222 of the I-T Act," a senior I-T officer said.