Directorate of Income Tax (Criminal Investigation).

Directorate of Income Tax (Criminal Investigation).

In the recent past the Government has adopted five-fold strategy to tackle the menace of illicit funds. This consists of:

1. Joining global crusade against ‘black money’
2. Creating an appropriate legislative framework
3. Setting up institutions for dealing with Illicit Funds
4. Developing systems for implementation
5. Imparting skills to the manpower for effective action.

-Taking further the strategy of setting up institutions for dealing with illicit funds, Government has approved the setting up of a Directorate of Income Tax (Criminal Investigation).

-The new Directorate of Income Tax (Criminal Investigation), to be known in short as DCI, has been created by the Central Government in the Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, with immediate effect.

-The DCI will perform functions in respect of criminal matters having any financial implication punishable as an offence under any direct tax law including, inter alia –(i) Chapter XXII of the Income Tax Act 1961 (Act 43 of 1961); and (ii) Chapter VIII of the Wealth Tax Act 1957 (Act 27 of 1957).

-Broadly, the DCI will be required to perform the following functions:

1. To seek and collect information about persons and transactions suspected to be involved in criminal activities having cross-border, inter-state or international ramifications, that pose a threat to national security and are punishable under the direct tax laws
2. To investigate the source and use of funds involved in such criminal activities

-In order to execute its functions it will have the power to issue show cause notices, file prosecution complaints in courts, to hire prosecutors and experts, to protect and rehabilitate supportive witnesses etc. etc

 -The DCI will be headed by a Director General of Income Tax (Criminal Investigation), who will be an officer of the rank of Chief Commissioner of Income Tax, and will be located in New Delhi.

-The DCI will function under administrative control of the Member (Investigation) in the Central Board of Direct Taxes (CBDT) and will be a subordinate office of CBDT.

-The DCI shall have eight Directors of Income Tax (Criminal Investigation) located at Delhi, Chandigarh, Jaipur, Ahmedabad, Mumbai, Chennai, Kolkata and Lucknow each of which will be headed by officers of the rank of Commissioner of Income Tax who will perform such functions as are notified or assigned to them by the CBDT.

Revision Questions on Black Money and Directorate of Income Tax (Criminal Investigation).

1. Which of the following institutes has/have been commissioned by Government of India to carry out an in-depth study to estimate unaccounted income and wealth held within and outside India?

1. National Institute of Public Finance and Policy
2. National Institute of Financial Management
3. National Council of Applied Economic Research
4. All of the above

2. Consider the following statements with reference to Directorate of Income Tax (Criminal Investigation):

1. The Directorate will function under the Directorate of Enforcement in Ministry of Finance, Government of India.
2. The Directorate has been created chiefly to investigate the source and use of funds involved in criminal activities

Which of the above are true in respect of the directorate?

1. 1 only
2. 2 only
3. Both 1 and 2
4. Neither 1 and 2

3. Criminal offences committed under which of the following acts can be investigated by the Directorate of Income (Criminal Investigation)?

1. Income Tax Act, 1961
2. Wealth Tax Act, 1957
3. Central Excise Act, 1944
4. Both (a) and (b)

4. The Central Government has recently ordered an in-depth study to estimate unaccounted income and wealth. Which of the following is true in this respect?

1. The study will examine the methods employed in generation of unaccounted money and conversion of the same into accounted money.
2. The study will suggest ways and means for detection and prevention of unaccounted money and bringing the same into the mainstream of economy.
3. The study will suggest methods to be employed for bringing to tax unaccounted money kept outside India.

Code:

1. 1 only
2. 2 only
3. 1, 2 and 3
4. 2 and 3 only