Government auditor Comptroller and Auditor General on Tuesday said I-T department has provided "irregular" tax benefits to infrastructure companies without verification, which have cost the exchequer over Rs 4,500 crore.
Central Board of Direct Taxes (CBDT) did not have any established mechanism to assess the impact of revenue foregone on account of deductions under Section 80 IA on the economy and industrial growth of the country, it said.
The Income Tax department has "irregularly" allowed deductions to various companies engaged in infrastructure business which have tax effect of Rs 4,524 crore, CAG said.
This included Rs 1,766.74 crore tax benefit availed by Reliance Ports & Terminals Ltd for construction of captive jetties at Port Sikka in Bihar. The other major companies that availed of such benefits include JSW Energy (Rs 340 crore), Reliance Infrastructure
(Rs 51.88 crore), Tata Power (Rs 36.99 crore) and Gujarat Fluro Chemicals (Rs 22.75 crore). - www.business-standard.com[23-11-2016]