CBDT chief tells tax officers to target Rs 3 lakh crore unexplained cash deposits during note ban
The Economic Times, Sugata Ghosh, September 29, 2017
MUMBAI: It could be taxing times for tax officials as well as those they turn their glare on. They have been told by the chief of the Central Board of Direct Taxes (CBDT), the apex body, to target and impose tax on Rs 3 lakh crore deposits which is estimated to be the quantum of unexplained cash parked with banks after demonetisation was announced.
CBDT chairman Sushil Chandra conveyed the message in a recent video conference to senior officials of I-T department, according to two persons who attended the meeting.
Identifying a sizeable slice of deposits as unaccounted cash will not only shore up overall direct tax collection in a slowing economy, but also give the government a chance to showcase the success of demonetisation, which has been blamed by the Opposition for the dip in growth.
Tax authorities technically have the power to come down heavily on those who are unable to explain their cash deposit by slapping 60 per cent tax and penalty. But such a process, entailing a case-by-case scrutiny, could be tedious and time consuming.
"It's unclear how the Rs 3 lakh crore number has been arrived at... even if it is a fairly accurate estimate, which it probably is, the department will take about two years before it begins to verify the explanations (that depositors offer). In next few months, the assessments pertaining to notices which were sent in September 2015 (for the financial year 2014-15) will have to be dealt with as these will get time-barred in December 2017," said a person familiar with the matter.
"Next, the assessments related to notices for financial year 2015-16 which will get time-barred in December 2018 will be taken up... only after these are done, the department will be in a position to pursue cases for 2016-17 when the demonetised cash was deposited. Otherwise, where's the manpower?" the person said.
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