FROM TRACKING the variety of on-line visits of customers on its portal to flagging high-value transactions and filtering out PANs concerned in wrongful claims, the Revenue Tax Division is now leveraging synthetic intelligence to establish patterns in taxpayer behaviour.
As an illustration, repeated on-line entry to Annual Info Assertion, which is an in depth abstract of a pre-filled Revenue Tax Return, may level to a tax return that must be filed, however isn’t being filed. Or, it’s simply attainable that the taxpayer is unable to file returns appropriately regardless of a number of makes an attempt. The I-T Division can use this data to intervene and assist the taxpayer.
The concept is to progressively create a 360-degree profile of taxpayers’ transactions and establish patterns and nuances within the submitting of tax returns, stated Central Board of Direct Taxes (CBDT) Chairman Ravi Agrawal in an interview to The Indian Categorical.
The division is a repository of wealthy knowledge — as many as 40 crore AIS have been generated from an estimated 650 crore monetary transactions within the final monetary 12 months. Primarily based on AI-linked knowledge evaluation, the Division is of the view there may be scope for enchancment within the whole variety of returns being filed.
Whereas 9 crore returns have been filed by taxpayers final 12 months, about 7.42 crore taxpayers are recorded as having considered their AIS, returning as many as 3.5 occasions on a median to see their statements.
AI can also be serving to increase “crimson flags” in high-value transactions, however the place returns aren’t being filed or the taxpayers are repeatedly committing a mistake in submitting tax returns, prompting the Division to think about whether or not the taxpayer requires a “tougher nudge”, Agrawal stated. The usage of AI has additionally proven that there have been gaps, and generally supplied tips that could circumstances the place the deductions and the exemptions that have been claimed weren’t right.
“On a median, taxpayers visited about 3.5 occasions to see their AIS. This implies the visits to see their AIS, in combination, was 24 crore occasions. This turns into a reference level for the taxpayer to see their ledger and take a name on what tax is to be paid and whether or not advance tax must be paid or not. This implies there’s a broad acceptance of the data and the ledger within the type of AIS. 9 crore individuals are submitting the returns, and you’ve got greater than about 40 crore AIS. So, there’s a scope for additional enhance within the variety of returns. On a median, taxpayers visited about three and a half occasions to see their AIS. Which means the visits to see their AIS, in combination, was 24 crore occasions,” Agrawal stated.
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The Revenue Tax Division has been taking measures for taxpayers to file returns appropriately. On this path, the Division on July 14 had initiated a large-scale verification operation throughout 150 places within the nation, focusing on people and entities facilitating fraudulent claims of deductions and exemptions in ITRs that has resulted in identification of over 1.5 lakh PANs . “This was mainly an train in that path. The taxpayer experiences sure revenue, and whereas calculating their revenue, experiences sure exemptions or deductions that are taken on face worth and the system processes. However what we discovered by way of AI was that there have been gaps, they usually have been actually patterns that emerged, which mirrored that the deductions and the exemptions that have been claimed weren’t the right deductions/exemptions. So, due to this fact, our pan-India train was undertaken to additionally flag and produce residence the purpose that whereas we belief the taxpayer, however then on the identical time, incorrect claims of deductions and exemptions isn’t acceptable,” he stated.
The CBDT Chairman stated these actions weren’t particularly in opposition to the taxpayers however in opposition to the intermediaries or the facilitators who’re misguiding the taxpayers. “These may very well be professionals or intermediaries. By way of these, greater than 1.5 lakh PANs have been recognized. The train remains to be happening,” he stated.
For submitting up to date returns, 19,501 taxpayers have been nudged primarily based on knowledge acquired below computerized trade of knowledge, which resulted in 62 per cent of them revising their returns and a complete of 30,161 taxpayers declared overseas belongings price Rs 29,208 crore and overseas revenue of Rs 1,089 crore. Over Rs 9,000 crore have been additionally recognized to have been claimed in extra deductions below Part 80GGC. Nudging taxpayers by way of SMS and emails led to a discount of Rs 963 crore in deductions and cost of Rs 409.50 crore in extra taxes as of June 18. Round 89 lakh up to date ITRs have additionally been filed, producing Rs 9,577.06 crore in extra taxes as of June 18, 2025.
The info evaluation has led the division to flag gaps by sending mails to taxpayers. “No matter coordinates you will have, you’ll be able to inform. The second element is whosoever is submitting the return, whether or not an accurate return has been filed or not. In case, there may be an apparent hole or one thing which must be flagged and from the taxpayer nudge him in the direction of higher compliance, and proper compliance. And the third element is: in the event you discover that the taxpayer is repeatedly committing a mistake, can there be a case of a tougher nudge?” he stated.
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Nonetheless, the division is dealing with a roadblock as the e-mail addresses offered for communications are turning out to be these of intermediaries or short-term. “Since it’s an end-to-end, e-enabled service that the Tax Division is offering, except the taxpayer provides us the precise coordinates of electronic mail and cellular, it turns into actually very tough for the division to correspond with the taxpayer,” he stated.