If you thought ISRO only launches satellites in space, think again. ISRO also helps Income Tax department catch hold of tax defaulters. An assessee claimed exemption on capital gains he made by selling his farmland. However, exemption is given only if the land has been used for agriculture purpose for at least two years before the sale. Suspecting false information, the Income Tax officials contacted Indian Space Research Organisation (ISRO) and procured satellite images of the land, taken over a period of three years. Based on ISRO’s scientific appraisal, the Income Tax department was able to prove that the land was barren and not used to raise crops.

The assessee’s claim for capital gains tax exemption was rejected and action taken against him. Income Tax department’s new mantra is that nobody should escape the tax net. For this the department, apart from using all means at its own disposal, is also soliciting help from other government agencies to track down, charge, hold accountable and recover taxes from those seeking to evade them. ISRO, Central Bureau of Investigation (CBI), Enforcement Directorate (ED), Securities and Exchange Board of India (SEBI), Road and Transport Office (RTO), nationalised and private banks, Registrar of Companies (RoC) and Registrar of Land are some of the agencies helping the I-T department in this task.

Eye in the sky 

PC Mody, the former Director General (DG) of Investigation at the Income Tax in Gujarat, told Mirror: “Due to urbanisation, cities have come closer to farmlands. When that happens, the farmer might want to sell his land and purchase arable land outside city limits. In such cases, there is exemption of capital gains tax if the land has been used for agriculture for at least two years before sale. However, some people sell land that has never been farmed and claim exemption to avoid taxes.”

Tax evaders’ modus operandi 
Explaining the modus operandi of such evaders, he said, “Landowners often claim tax exemption on the basis of payment slips from vendors, thus proving that they had farmed the land before selling it. Although this is really the case many times, there are people who seek to cheat the taxman.”

Calling the Bluff 
This is when ISRO comes into the picture. The Income Tax Department requests satellite imagery of the piece of land for specific time periods and if there are no standing crops in that period, it is proved that the assessee is trying to avoid taxes. Punitive steps can then be taken against such persons.

Phone a Friend 
Apart from India’s space agency, the National Bank for Agriculture and Rural Development (NABARD) helps in tracking down those who do not engage in farming but show their income as agricultural and use it as a means to launder money. The Securities and Exchange Board of India helps in providing information related to stock market transactions and other details regarding capital markets. The Enforcement Directorate, India’s specialised financial investigation agency under the Ministry of Finance helps in tracking money laundering.

The Central Bureau of Investigation helps the Taxman in cases related to the suspected involvement of government officials and banking officials in tax evasion. Banks provide assistance in unearthing benami transactions and in unearthing black money. Wealth is often converted into vehicles purchased in the names of relatives or friends by evaders. The RTO helps track such investments. The Registrar of Companies under the Ministry of Corporate Affairs helps identify shell companies that are often used for money laundering. Registration and Stamps department, which registers land documents, helps in supplying information about immovable properties and benami property transactions.

Project Insight 
Income Tax department will also be keeping tabs on social media accounts to check for discrepancies in returns filed with assets displayed on platforms like Facebook and Instagram. Project Insight will use big data analytics to match information from social media sites to deduce mismatches between spending and income declaration. This will be used to find those evading taxes and to hunt down black money and benami transactions.

Need for co-operation 
Speaking on agency-to-agency co-operation to nab tax evaders, P C Mody said, “Evaders shouldn’t believe that they can hide tax deductible wealth. We get information from various agencies and we also contact them on a case-by-case basis. In modern India, all data is at the fingertips and we just need to ask for it.”