No threat or show cause notices to taxpayers: CBDT tells officials

IN A set of instructions to tax officials, the Central Board of Direct Taxes (CBDT) has directed them to ensure that no threat, warning or show cause notice is served online to taxpayers as part of the ongoing ‘Operation Clean Money’ for verification of cash deposits post-demonetisation.

However, any bank account suspected to have been “misused” for money laundering or shell company operations won’t be exempted from probe despite having low deposits, the CBDT said. As part of the eight-page instruction leaflet, the CBDT has said, “It should be ensured that the communications made online with the persons under verification should be in very polite language without containing any element of threat or warning. No show cause of any kind should be given.” It further added a word of caution that “even telephonic queries” from taxpayers are to be avoided. “Whatever information is necessary during verification, the same has to be collected through the person under verification using online platform only,” the instructions, issued to all field offices of the I-T department, said.

As part of Operation Clean Money, the tax department had sent SMSES and emails to 18 lakh people who made suspicious deposits of over Rs 5 lakh during the 50-day deposit window post-demonetisation. Nearly six lakh people have replied on the e-filing portal in the response window provided till February 15. The CBDT also asked tax officials to keep their queries “relevant and limited in number” and to keep their seniors in the loop while processing these cases.

It has been mentioned that in case the assessing officer is “satisfied” by the explanation provided by the taxpayer then the case should be closed electronically “without any physical interface with the person concerned.”

It has also said that verification under this exercise should be completed quickly so that erring taxpayers can avail the one-time window of the Pradhan Mantri Garib Kalyan Yojna (PMGKY) that ends on March 31, to disclose their unaccounted money. In those cases, where black money is detected, the CBDT has asked the assessing officer to initiate action like survey and call for documents from the concerned taxpayer after consultation with his superiors.

For probe of deposits, the Board has directed field officers that in case of an individual (other than minors) not having any business income, “no further verification is required to be made of total cash deposit is up to Rs2.5 lakh”. “Amounts above this cut-off may require verification to ascertain whether the same is explained or not,” it said.

In case of people engaged in business or those required to maintain books of accounts, the CBDT instructions said, “No additional information is required to be submitted by the person under verification if total cash out of earlier income or saving is not more than the closing cash balance as on 31 March 2016 in the return for assessment year 2016-17.”

However, if any discrepancy in these records is found “further verification may be carried out”.

A special relief has been given to those who were declarants under one-time domestic black money window under Income Declaration Scheme last year, while verification will be kept “pending” for those who intend to disclose their black money under the ongoing PMGKY scheme.

Says, accounts suspected to have been ‘misused’ for laundering ... won’t be exempted from probe FM TO INDIA INC