The Income Tax Department (IT) is set to issue notices to one lakh entities and individuals, who deposited huge cash in banks Post Demonetisation and whose tax returns have been picked for detailed probe into suspected discrepancies, official sources reportedly said today.
The Government on November 8 last year had announced the scrapping of Rs 500 and Rs 1,000 notes, totaling Rs 15.44 lakh crore. It constituted 86 per cent of the total cash in circulation. The income tax department will issue notice this week itself.
In the first portion notices will be issued to 70,000 entities that deposited over Rs50 lakh in cash in banks but chose not to file tax returns or respond to the relevant income tax department advisories.
This notice shall be issued under section142 (1) of the I-T Act.
Section 142(1) tax notice is the notice that is usually served, in a case where the return has been filed, to call for further details and documents from the assessee and to take a particular case under assessment.
It has been an year ago, the prime minister Narendra Modi led the nation demonitising the currency and this policy can be treated as financial reforms in our country.
The department post demonitisation have been selected 20572 tax returns for the detailed probe, declared by the government on 8 November last year. The rest of the scrutiny notices will be issued in due course, they added.
This action will be followed by the taxman issuing similar notices by next month to those individuals and entities who have made deposits between Rs 25 lakh and Rs 50 lakh post demonetisation.
The income tax department has conducted about 900 raid between November 2016 and March this year and found disclosure of Rs 7,961 crore undisclosed income, leading to seizure of assets worth Rs 900 crore, including Rs 636 crore in cash.
According to the official data. During the same period, the department conducted 8,239 survey operations leading to detection of Rs6, 745 crore of black money, it had said.
In a statement in Parliament, the then MoS Santosh Kumar Gangwar said that, the number of income tax payers has increased after demonetization. During the period of 09.11.2016 to 31.03.2017, 1.96 crore returns were filed as compared to 1.63 crore returns filed during corresponding period of FY 2015-16 and 1.23 crore returns filed during corresponding period of FY 2014-15.
The Income Tax Department has earlier started raising queries on suspicious bank account deposits, including the deposits made in co-operative banks, post demonetization.
In a statement issued earlier, the Central Board of Direct Taxes (CBDT) clarified that, Under the existing provisions of Section 139(5) of the Income-tax Act, 1961, Revised Return can only be filed if any person, who has filed a return under Section 139(1) of the Act or in response to notice u/s 142(1), discovers any omission or any wrong statement therein.
