HRA Fraud: PAN card fraud is being done to avail HRA benefits, thousands of cases caught

HRA Fraud: PAN card fraud is being done to avail HRA benefits, thousands of cases caught

PAN Card Misuse: Income Tax Department has revealed that HRA Fraud is being committed by misuse of PAN Card. The IT Department has received information about such cases in which people are availing the benefit of House Rent Allowance despite not being tenants. Apart from this, people are taking advantage of wrong HRA deduction in many ways. Till now the department has collected information about about 10 thousand high value cases involving amount of Rs 10 lakh or more. 

Rent receipt of Rs 1 crore revealed 

This matter came to light due to an interesting case. In this, a person had attached a rent receipt of Rs 1 crore. When more investigation was done on this. Also, the person whose PAN number was mentioned in it was interrogated. He denied any such income. Further investigation revealed that he had not received this Rs 1 crore. His PAN card was misused. 

Used only one PAN card for claim

After this the Income Tax Department further increased the scope of this investigation. Gradually hundreds of such cases started coming to light. The Income Tax Department came to know that PAN card is being misused extensively. People are committing such frauds on a large scale to avail HRA benefits from their companies. Some cases have also been detected where employees working in the same company have used the same PAN card to claim tax deduction.

Income Tax Department preparing for recovery 

According to the report of Times of India, tax officials are now preparing for recovery against the employees making such fake claims. However, it is not yet clear whether legal action will be taken against these people or not. At present, the facility of deducting TDS is available only on paying rent more than Rs 50 thousand per month. Therefore, many employees are misusing it to save tax on rental income.

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