HYDERABAD: Chief Commissioner of Income Tax here D.V. Dharmik has allayed fears over the reported complex nature of Form 2F for filing returns by individuals saying it is actually introduced to avoid embarrassing assessees with enquiries.

"The main purpose of Form 2F is to crosscheck the wealth of information collected from third party sources through Assessee Information Returns (AIR) with the outgoings without intrusive investigation," he told a news conference on Friday.

High-value items

Mr. Dharmik said that the department had been getting a lot of information on AIR, particularly investments and expenditure on high-value items.

"We can crosscheck details of cash-flow statement in the return with our own information. It ensures that we do not have to ask questions of expenditure if the figures tally."

The Chief Commissioner referred to high-value items as luxury items.

The department would seek estimated figures of such expenditure, which were close to actuals. It would insist on annual expenditure of assesses.

Salaried employees who formed a major chunk of assessees filing returns with Form 2F generally had a fixed expenditure whose details were not difficult to be maintained.

They need not take the assistance of professional auditors to file returns as the cash-flow statement was not only self-explanatory but simple, he added.

Mr. Dharmik said that the statement sought simple information like cash and bank balance at the beginning of the financial year. Income receipts and outgoings by way of investments should be mentioned without having to enclose documents. Details of receipts were not required.

Optional statement

He also said that the statement was optional for the assessment year 2006-07. This category of assesses could file returns in the existing Naya Saral Form 2E or 2F before July 31. They should, however, file returns only in Form 2F from August 1.

Referring to the progress in the notices served on 5,000 people in the State who indulged in high expenditure without a track record of IT assessment, he said 1,200 notices bounced back as they were sent to defective addresses.

Therefore, the department had decided to source its information to identify them.

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