November 10th, 2016
The Centre on Wednesday said that it will be monitoring all cash deposits of over Rs 2.5 lakh that are made till the end of the year, and it could attract a tax and a 200 per cent penalty in case it is disproportionate to the account owner’s income.
The banks have been asked to keep the PAN details of people depositing such large amounts over the 50-day period till December 30.
Any mismatch with income declared by the account holder will be treated as a case of tax evasion.
“This would be treated as a case of tax evasion and the tax amount plus a penalty of 200 per cent of the tax payable would be levied as per the Section 270(A) of the Income Tax Act,” said revenue secretary Hashmukh Adhia.
Along such developments, the government also promised that it will not cause any problems to housewives, small businesses, or workers depositing Rs 1.5 to 2 lakh in their accounts.
Adhia has suggested that strong actions will be taken against jewellers who sold gold and jewellery at a premium and accepted cash without insisting on details of the buyer’s permanent account number (PAN).
“We are issuing instructions to field authorities to check with all jewellers to ensure that this requirement (of furnishing PAN) is not compromised. Action will be taken against those jewellers who fail to take PAN numbers from buyers. When the cash deposits of jewellers will be scrutinized against the sales made, whether they have taken the PAN number of the buyer or not will also be checked,” he said, as reported by Times Of India.
Adhia also said that the government will be receiving daily updates on the number of Rs 500 and Rs 1,000 notes deposited in each bank branch. As per the law, large cash deposits have to be reported to the government. The department will also get reports on all cash deposited during November 10 to December 30, above the threshold of Rs 2.5 lakh.
This move is speculated to reveal information about individuals who have large amounts of unaccounted cash with them.