The Central Board of Direct Taxes (CBDT) and the Ministry of Corporate Affairs have signed an agreement wherein they will be sharing tax-related data of corporate entities. This will contribute significantly towards identifying shell companies and taking action against them as per legal provisions. The agreement would allow both entities to share various details of corporate entities such as PAN numbers, I-T Returns, financial statements, audit reports, statement of financial transactions, etc. The information sharing agreement would apply to both Indian as well as foreign companies operating in India. The agreement allows both government bodies to share any type of data that they may have related to a corporate entity.
The agreement has been done with the goal to check the problem of shell companies, money laundering and black money. Sharing of data between the two government agencies will help identify shell companies that may be engaged in illegal activities. Much of the information will be shared automatically and some information can also be made available on demand. To ensure smooth flow of information between the two government bodies, a data exchange steering group has been constituted. The data team will work to maintain the system and carry out improvements wherever needed.