Thursday, November 10th, 2016

Bank deposits of over Rs 2.5 lakh may attract tax, 200% penalty

Narada Desk | November 10, 2016 11:39 am Print
The revenue secretary said small businessmen, housewives, artisans and workers who had some cash lying as their savings at home should not be worried about any tax department scrutiny.
Hasmukh Adhia : Revenue Secretary
The government warned on Wednesday night that cash deposits above Rs. 2.5 lakh threshold under the 50-day window may attract tax along with a 200 per cent penalty in the case of income mismatch.
Revenue Secretary Hashmukh Adhia said: “We would be getting reports of all cash deposited during the period of November 10 to December 30, 2016, above a threshold of Rs. 2.5 lakh in every account. “The (tax) department would do matching of this with income returns filed by the depositors. And suitable action may follow.”
Any mismatch with income declared by the account holder will be treated as a case of tax evasion, if not proven otherwise. “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,” he added.
The revenue secretary said small businessmen, housewives, artisans and workers who had some cash lying as their savings at home should not be worried about any tax department scrutiny.
“Such group of people… need not worry about such small amount of deposits up to Rs. 1.5 or 2 lakh since it would be below the taxable income. There will be no harassment by the Income Tax Department for such small deposits made,” he said.
On people resorting to buying of jewelry, he said persons buying jewelry has to provide the PAN number.
“We are issuing instructions to the field authorities to check with all the jewellers to ensure this requirement is not compromised. Action will be taken against those jewellers who fail to take PAN numbers from such buyers. When the cash deposits of the jewellers would be scrutinised against the sales made, whether they have taken the PAN number of the buyer or not will also be checked,” he added.
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