Specify time limit for remittance of SEZ export proceeds

The Comptroller & Auditor General of India has asked the Central Board of Direct Taxes to consider specifying a time limit for remittance of export proceeds by special economic zone (SEZ) units for claiming deduction under Section 10AA of the Income Tax Act.

It said that non-examination of suspicious business activities and short accounting of stocks in 33 significant issues involved tax effect of ₹37,909.38 crore between FY13 and FY18.

"Such irregularities had the underlying risk of tax evasion that require further probing and detailed examination," CAG said in its performance audit on 'Assessment of Assessees of Gems and Jewellery Sector'. It also said standard operating procedure and standard guidelines entailing checks be exercised during scrutiny assessment of gems and jewellery to curb the "unscrupulous trade practices resorted by diamond traders/manufacturers".