New Delhi: The Income Tax Department responded to a query put by entreprenuer Ashneer Grover questioning the former’s move regarding obtaining three-year Income Tax Return (ITR) details from start-ups of their shareholders.
Ashneer had questioned the Ministry and asked “How and why will companies have ITR of shareholders!”
Reacting to Ashneer’s post on X (formerly known as Twitter), IT Department stated a number of laws, defending their case on the mciro-blogging site.
“Dear @Ashneer_Grover, Section 68 of the Income-tax Act, 1961 (the Act) under which the Assessing Officer (AO) has made the inquiry about creditworthiness of the shareholder/investor, places the initial onus on the assessee-company to prove the following: Identity of the investor, Creditworthiness of the investor and Genuineness of the transaction.”
Dear @Ashneer_Grover,
1.Section 68 of Income-tax Act, 1961 (the Act) under which the Assessing Officer (AO) has made the enquiry about creditworthiness of the shareholder/investor, places initial onus on the assessee-company to prove the following:
a) Identity of the investor…
— Income Tax India (@IncomeTaxIndia) September 8, 2023
Listing five points to their tweet, the Ministry said added that this has been the practice as reflected in various tweets in the thread.
Earlier, Ashneer had objected the move while questioning the reason that the ministry had stated: ‘to establish creditworthiness of shareholders’ ?
He had asked: 1) How and why will companies have ITR of shareholders ! 2) Why would a shareholder/individual share their ITR with a private company ?
Ashneer also requested the Finance Ministry to look into the matter.
He also added, “Response padh ke samajh aa gaya ki kitne log India mein ITR nahi bharte hai. ITR mein do party hai – tax payer and IT Dept. Why can’t IT department pull ITR from its own system by punching in PAN. Doosri baat ITR mein income from criminal activities ka koi line item nahi hota ;))”
In the last 1 month, a number of startups (a few in my portfolio as well) have received Income Tax notices asking to furnish information about shareholders.
Bahut interesting hai – they are asking start-up companies to furnish 3 year ITR of all shareholders. 1) How and why will… pic.twitter.com/f48593uE4T
— Ashneer Grover (@Ashneer_Grover) September 8, 2023
