High-value income tax refunds to be verified 

The income tax department today said all high-value refunds, above Rs 1 lakh, issued during the current financial year will be cross-verified to check the genuineness of those transactions as it has detected fraudulent tax refunds in certain cases earlier this month in Mumbai. 
The Central Board of Direct Taxes is therefore working to replace the current system of handling high value refunds “with a more robust and foolproof system” to prevent such recurrence, an official statement said. 
The statement said an officer in the I-T Department of the Mumbai circle noticed that refunds were issued from his jurisdiction without his knowledge earlier this month and on internal inquiry, it was found that user IDs and passwords of certain officers had been fraudulently used to generate refunds in some cases. 
In the wake of the fraud, the department gave “stop payment orders”, thus preventing refund outgo in at least two cases, the statement said. 
In the investigation undertaken by the Directorate of Income Tax and (Investigation), Mumbai, bank accounts to which refunds had been credited, beneficiaries and some of the scamsters have been identified. Following this, Mumbai police and CBI Mumbai have been informed. 
According to sources, the amount involved in fraudulent refunds is still not known and it is still not clear whether the I-T software was hacked. 
The I-T department has issued Rs 8,954 crore of refunds during the first nine months of this fiscal.

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