Press Information Bureau

Government of India

Ministry of Finance

30-May-2011 15:17 IST

New Directorate of Income Tax (Criminal Investigation) Created; to be Headed by an Officer of the Rank of Chief Commissioner of Income Tax; to Look into Criminal Matters Having any Financial Impliaction Punishable as an Offence Under any Direct Tax Law

A new Directorate of Income Tax (Criminal Investigation), to be known in short as DCI, has been created in the Central Board of Direct Taxes, Department of Revenue, Ministry of Finance, with immediate effect. The DCI has been created by the Central Government through a notification today.

          The DCI will perform functions in respect of criminal matters having any financial implication punishable as an offence under any direct tax law including, inter alia –(i) Chapter XXII of the Income Tax Act 1961 (Act 43 of 1961); and (ii) Chapter VIII of the Wealth Tax Act 1957 (Act 27 of 1957).

          The DCI, in discharge of its responsibilities under the direct tax laws, will be required to perform the following functions:

(a)      To seek and collect information about persons and transactions suspected to be involved in criminal activities having cross-border, inter-state or international ramifications, that pose a threat to national security and are punishable under the direct tax laws;

(b)      To investigate the source and use of funds involved in such criminal activities;

(c)      To cause issuance of a show cause notice for offences committed under any direct tax law;

(d)      To file prosecution complaint in the competent court under any direct tax law relating to a criminal activity;

(e)      To hire the services of special prosecutors and other experts for pursuing a prosecution 'complaint filed in any court of competent jurisdiction;

(f)       To execute appropriate witness protection programmes for effective prosecution of criminal offences under the direct tax laws, i.e. to protect and rehabilitate witnesses who support the state in prosecution of such offences so as to insulate them from any harm to their person;

(g)      To coordinate with and extend necessary expert, technical and logistical support to any other intelligence or law enforcement agency in India investigating crimes having cross-border, inter­state or international ramifications that pose a threat to national security;

(h)     To enter into agreements for sharing of information and other cooperation with any central or state agency in India;

(i)       To enter into agreements for sharing of information and other cooperation with such agencies of foreign states as may be permissible under any international agreement or treaty; and

(j)       Any other matter relating to the above.

          The DCI will be headed by a Director General of Income Tax (Criminal Investigation), who will be an officer of the rank of Chief Commissioner of Income Tax, and will be located in New Delhi. The DCI will function under administrative control of the Member (Investigation) in the Central Board of Direct Taxes (CBDT) and will be a subordinate office of CBDT.

The DCI shall have eight Directors of Income Tax (Criminal Investigation) located at Delhi, Chandigarh, Jaipur, Ahmedabad, Mumbai, Chennai, Kolkata and Lucknow. These Directorates will be headed by officers of the rank of Commissioner of Income Tax who will perform such functions as are notified or assigned to them by the CBDT. The CBDT shall have all powers to amend the functions assigned to the DCI.

        The headquarters of the DCI shall consist of a Director General of Income Tax (Cl) supported by a Director of Income Tax (CI), an Additional Director of Income Tax (Cl), a Deputy Director of Income Tax (Cl) and officials known as Special Agents of the rank of Income Tax Officer and Agents of the rank of Inspector of Income Tax. Each zonal Directorate of the DCI shall be headed by a Director of Income Tax (Cl), and shall be supported by an Additional Director of Income Tax (CI), a Deputy Director of Income Tax (CI) and an appropriate staff complement consisting of Special Agents and Agents.

It may be recalled that the Government has adopted five-fold strategy to tackle the menace of illicit funds. This consists of:

i)             Joining global crusade against ‘black money’;

ii)           Creating an appropriate legislative framework;

iii)          Setting up institutions for dealing with Illicit Funds;

iv)          Developing systems for implementation; and

v)            Imparting skills to the manpower for effective action.

Taking further the strategy of setting up institutions for dealing with illicit funds, Government has approved the setting up of the aforesaid Directorate.

DSM/SS/GN

Criminal tax investigation unit established to centralize probing, prosecution and international cooperation on direct tax offences. A new Directorate of Income Tax (Criminal Investigation) (DCI) has been established under the Central Board of Direct Taxes to investigate, prosecute and coordinate action on criminal matters with financial implications under direct tax laws, including offences under the Income Tax Act and Wealth Tax Act. The DCI may collect and share information, hire special prosecutors and experts, run witness protection programmes, cooperate with domestic and permissible foreign agencies, and is headed by a Director General of Income Tax (Criminal Investigation) under the administrative control of the Member (Investigation) of the CBDT.