*Searches, raids, seizure to begin after Sept 30
Mohinder Verma
JAMMU, July 8: Income Tax Department is eying recovery of at least Rs 100 crore worth black money from Jammu and Kashmir under Income Declaration Scheme (IDS) launched by Narendra Modi Government from June 1 this year. The defaulters, who will not come forward to avail this golden opportunity, would have to face searches and raids in their premises and seizure of the bank accounts from October 1, 2016 as the department is in the possession of a list of such persons.
The Income Declaration Scheme is contained in the Finance Act, 2016 which received the assent of the President of India on May 14, 2016. The scheme provides an opportunity to persons, who have not paid full taxes in the past, to come forward and declare the undisclosed income. They will have to pay tax, surcharge and penalty totaling in all to 45% of such undisclosed income on declaration.
In an exclusive interview to EXCELSIOR, Principal Commissioner of Income Tax, J&K Circle, Sangeeta Gupta said that Income Declaration Scheme is one time opportunity to all those persons who have not declared income correctly in earlier years to come forward and declare such undisclosed income (black money) to avoid stern action from October 1, 2016 onwards.
“This scheme applies to undisclosed income in the form of assets or otherwise pertaining to Financial Year 2015-16 or earlier years”, she said, adding “fair market value of the asset as on June 1, 2016 is deemed to be the undisclosed income under the Income Declaration Scheme”.
According to Sangeeta Gupta, the assets declared under Income Declaration Scheme are exempted from Wealth Tax and there is no scrutiny/enquiry under Income Tax Act/Wealth Tax Act in respect of such declarations. Moreover, there is immunity from prosecution under Income Tax Act/Wealth Tax Act and from Benami Transactions (Prohibition) Act, 1988 subject to certain conditions. “The tax, surcharge and penalty to be paid on such declarations can be made by November 30, 2016”, she added.
About the mode of making declaration, she said that declarations can be filed online or to jurisdictional Principal Commissioner of Income Tax, adding “utmost secrecy is being maintained in respect of disclosure of undisclosed income under this scheme so as to avoid any sort of inconvenience to the person concerned”.
Stating that Income Tax Department is eying recovery of at least Rs 100 crore worth black money under the scheme, Principal Commissioner said, “the department has prepared a list of defaulters, which include businessmen, industrialists and other sections of the society by collecting information from banks, Investigation Wing of the department and other reliable sources”, adding “the list also includes those non-filers of Income Tax returns, who were issued notices by the department in the recent past”.
In response to a question, Sangeeta Gupta said, “the department is having profile of all the defaulters and if they fail to come clear by disclosing the undisclosed income consequential action will be taken after September 30, 2016 which includes raids, searches and seizure of bank accounts so that black money holders don’t go scot free”.
Stating that compliance has already been started under the scheme, the Principal Commissioner of Income Tax said, “several disclosures have been made since the start of the scheme. I am hopeful that persons having black money will avail this scheme to avoid stringent action from the department”, adding “there are multiple benefits of disclosing undisclosed income as on one side the defaulters would be able to avoid action from the department and on the other side they would be contributing to the developmental profile of the country”.
She informed that penalty after the expiry of Income Declaration Scheme would be 200% for under-reporting or misreporting as such the period up to September 30 is the golden time for disclosing the undisclosed income.
When asked about 45% tax, surcharge and penalty on undisclosed income, she said, “regular tax payers cannot be equated with the defaulters as such for avoiding tax on the income for years together they are required to pay more as compared to normal assessees”.
Responding to another query, she said, “Income Tax Department is expecting maximum disclosure under the scheme from Jammu, Srinagar, Udhampur, Kathua, Rajouri, Katra, Anantnag and Baramulla districts”, adding “there are number of businessmen in other districts and towns also who have reportedly amassed black money”.
Meanwhile, as a tax-payers friendly move, the Income Tax Department is going to open office at Rajouri within next one month. “This office will not only help the assessees but also the department in maintaining vigil on the tax evaders”, said Principal Commissioner Income Tax.
With this, the number of offices of the Income Tax Department in Jammu region will go up to six including main office. During last financial year, the department on the directions of Sangeeta Gupta opened offices at Katra and Samba in Jammu and Baramulla in Kashmir valley.
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