the penalty clause of concealment of income as incorporated in 2711c of the incometax act under this law penalty can be imposed in cases where an assessee has concealed the particulars of his income or furnished inaccurate particulars of his income till you give the taxmen the power to arrest bigtime evaders mere imposition of penalty wont help much people evade tax for nine years and pay penalty in the tenth year why should anyone bother at all says a senior tax official on condition of anonymity the government faces a difficult situation in the past few years it has raised large and highlypublicised tax demands against a number of companies the most famous being the several thousand crore case against vodafone but if it gets too aggressive it faces the charge of dampening investor sentiment at a time when the economy is already weak the general antiavoidance rule was roundly criticised by foreign investors among others for giving tax officials powers which were too broad it was heavily watered down and notified this week but will only come into effect in 2016hoping against hope as of date the government does not have a clear policy on how to convince taxpayers through persuasion and recognition whereas efiling quick refunds and allowing tax returns to go unscrutinised can be called taxpayerfriendly measures the revenue department still does not have an agenda in place on how to differentiate the honest taxpayers from those who are deliberate evaders during his meetings at zonal tax offices seelam interacted with local business representatives in the presence of it and excise officials the issues if any were sorted out then and there he also made an appeal to the industry representatives to pay tax honestly and consider paying tax as a status symbol after the interactions seelam submits reports to p chidambaram giving details of the issues and actions taken on each matter yet is this pep talk enough to convince tax evaders to part with their profits also if the government is planning to give more recognition to top taxpayers as is hinted by seelam will it be foolproof profiling of honest taxpayers and giving them due recognition are the key factors here if a small businessman is specially invited for a pms party because he is an honest taxpayer i think it will give a good signal to others says psychologist ashis nandy after all top taxpayers are not necessarily the most honest ones