You have claimed some exemptions on your income or investments, but most of these are allowed if you fulfill certain conditions or rules. If these are not fulfilled, you could lose the exemptions.
For instance, if a taxpayer does not fulfil the criteria laid down for allowing exemption/deduction, then the exemption already allowed shall be withdrawn. In such cases, it is the taxpayer's duty to report the withdrawal of exemption in the tax return and pay the requisite taxes as applicable, says Vineet Agarwal, director, KPMG India.
Therefore, it is important to know what these conditions are.
In case the income-tax department issues you a notice for 'tax evasion', the penalty could be severe, says Sanjeev Gokhale, a Mumbai-based chartered accountant.
"You could be levied a penalty which can be 100-300 per cent of the amount evaded. Even if you say you were not aware of the exemption being reversed, it will not be accepted. Ignorance of law is not a justification for tax evasion."
Following are the 7 instances under which these exemptions could be withdrawn:
Text: Priya Nair, Business Standard
Associated Press, Reuters Images