Arun Jaitley Explains How Income Tax Returns Are Scrutinised

Finance Minister Arun Jaitley on Friday said that fear of scrutiny by income tax authorities is not an excuse for not paying taxes. A tax non-compliant person can't say that paying tax would invite further headaches, Mr Jaitley said. 

Explaining the tax scrutiny process, Mr Jaitley said: "Of those who file returns, all returns go onto the computer system directly to a central system. There is no human face. There are some alerts that come. At the end of the day, those red alerts indicate who is to be picked up for a scrutiny. You have a lot of cash withdrawals, a lot of cash deposits, you have some big property transactions...those are the kind of red alerts." 

Arun Jaitley was speaking to NDTV's Vikram Chandra at the Hindustan Times Leadership Summit. The finance minister said only about 3.5 lakh people or just one per cent of people who file returns are picked up for scrutiny every year. "To have a causal dinner time conversation and say that I won't pay taxes because I find that I would be scrutinised is a poor alibi," he said.