Tax dept to follow up on big deposits
The income tax department will issue follow-up letters to more than 10 lakh taxpayers who have failed to respond to its missive to explain high-value cash deposits in bank accounts between 9 November and 30 December.
As part of Operation Clean Money, to begin with, the department had sent e-mails and SMSs to 18 lakh individuals—those whose cash deposits in bank accounts exceeded ₹5 lakh as well as those with suspicious deposits between ₹3 lakh and ₹5 lakh. It asked these individuals to log into the department’s e-filing website and answer questions relating to the cash deposits, totalling to more than ₹4.5 lakh crore.
However, so far only a little over 7 lakh people have responded on the e-filing website.
The poor response is compounded by the fact that around 4.8 lakh individuals are not registered on the website.
The tax department now plans to follow up and issue ‘non-statutory’ letters or letters with per se no legal backing to the non-respondents, including those who do not have accounts on the e-filing website, said an official who declined to be identified.
The tax department will also reach out to individuals among the 7 lakh people who have responded in cases where the response is found to be unsatisfactory, the official added.
The tax department plans to delay issue of legal notices to these taxpayers in the hope that they will come forward and declare their income under the Pradhan Mantri Garib Kalyan Yojana, the scheme announced by the Narendra Modi government that gives tax evaders an opportunity to declare their illegal income and pay a tax and penalty of 50% of the amount.
The tax department has identified 1.09 crore accounts where deposits of ₹2-80 lakh were made, with average deposit size being ₹5.03 lakh, in the aftermath of demonetization. And around 1.48 lakh accounts received deposits of more than ₹80 lakh, with the average deposit size being ₹3.31 crore.