NEW DELHI: The earnings tax division on Friday stated that the burden of proof to determine the creditworthiness of an investor is on the corporate whose returns are being assessed. The assertion got here after BharatPe co-founder and former MD Ashneer Grover posted a questionnaire despatched by the tax division to some startups searching for particulars.
“Within the final one month, a variety of startups (just a few in my portfolio as properly) have obtained I-T notices asking to furnish details about shareholders. Bahut fascinating hai – they’re asking startup corporations to furnish 3-year ITR of all shareholders. 1) How and why will corporations have ITR of shareholders! 2) Why would a shareholder/particular person share their ITR with a non-public firm?” Grover posted on X on Friday.
Responding on the identical platform, the tax division stated that Part 68 of the I-T Act, underneath which the main points have been sought, locations the preliminary onus on the “assessee-company” to show the identification and creditworthiness of its buyers in addition to genuineness of the transaction.
Grover instructed TOI that three of his portfolio corporations have obtained the discover, which mandates corporations to offer the ITR of the final three years of their buyers apart from different particulars like title, tackle and PAN.
The tax division stated that this has been the apply, one thing that was confirmed by others.
Siddarth Pai, founding accomplice at 3one4 Capital, stated startups have been receiving such notices for the previous a number of years. “As startups battle with managing operations underneath capital constraints, such notices will additional spook buyers who could also be taking a look at them. Forcing startups to acquire such confidential data as tax returns of the buyers – which is offered to the tax division – locations them in an not possible place,” Pai instructed TOI.
“The division ought to use its powers underneath part 133(6) to immediately ask buyers for data versus making startups the middlemen,” Pai stated.
“Within the final one month, a variety of startups (just a few in my portfolio as properly) have obtained I-T notices asking to furnish details about shareholders. Bahut fascinating hai – they’re asking startup corporations to furnish 3-year ITR of all shareholders. 1) How and why will corporations have ITR of shareholders! 2) Why would a shareholder/particular person share their ITR with a non-public firm?” Grover posted on X on Friday.
Responding on the identical platform, the tax division stated that Part 68 of the I-T Act, underneath which the main points have been sought, locations the preliminary onus on the “assessee-company” to show the identification and creditworthiness of its buyers in addition to genuineness of the transaction.
Grover instructed TOI that three of his portfolio corporations have obtained the discover, which mandates corporations to offer the ITR of the final three years of their buyers apart from different particulars like title, tackle and PAN.
The tax division stated that this has been the apply, one thing that was confirmed by others.
Siddarth Pai, founding accomplice at 3one4 Capital, stated startups have been receiving such notices for the previous a number of years. “As startups battle with managing operations underneath capital constraints, such notices will additional spook buyers who could also be taking a look at them. Forcing startups to acquire such confidential data as tax returns of the buyers – which is offered to the tax division – locations them in an not possible place,” Pai instructed TOI.
“The division ought to use its powers underneath part 133(6) to immediately ask buyers for data versus making startups the middlemen,” Pai stated.
