What are the criteria for selection of cases for scrutiny assessment?

The Income Tax department uses specific criteria and risk parameters to select cases for scrutiny assessment. These may include high-value transactions, specific economic activities, discrepancies in tax filings, cash deposits or investments not commensurate with declared income, information from other governmental agencies, and other risk factors identified by the department. The Central Board of Direct Taxes (CBDT) issues guidelines annually specifying the Computer-Assisted Scrutiny Selection (CASS) criteria based on data analytics and risk management principles. However, the department also reserves the right to scrutinize any case at its discretion.