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CBDT releases FAQs on black money scheme

Posted Date : 21-May-2016 , 07:23:04 am | Posted By CASANSAAR print Print
The black money scheme announced in the budget has stringent checks and balances to ensure ill-gotten wealth is not laundered through this route. 

Money earned through corruption, income caught in an income tax raid or a survey will not be eligible for declaration under the scheme, according to the frequently asked questions released by the Central Board of Direct Taxes ( CBDT ). 

"The scheme shall not apply in relation to prosecution of any offence punishable under the Prevention of Corruption Act, 1988. Therefore, declaration of such undisclosed income cannot be made," set of the clarifications issued in the form of Q&A said. 

An emphatic 'No' was the response to a question on whether a person can declare undisclosed income which has been acquired from money earned through corruption. 

If such a declaration is made and it is found that the income represented money earned through corruption, it would amount to misrepresentation of facts and the declaration shall be void and if a declaration is held as void, the provisions of the Income Tax Act shall apply in respect of such income as they apply in relation to any other undisclosed income, it added. 

The four-month window which opens on June 1provides an opportunity to people having undisclosed income to come clean by paying 30% tax and a 'Krishi Kalyan Cess' of 25% on the tax payable, penalty and surcharge adding up to 45% of the income declared. The 14 FAQs said declarations made under the window will remain confidential as in the case of return of income filed by an assessee. 

The declarant, however, will be liable for capital gains tax on sale of such assets declared under the window in future. A person will not be eligible to make a declaration under the scheme if a search has been initiated and the time for issuance of notice under section 153A has not expired, even if such notice for the relevant assessment year has not been issued. 

The scheme for domestic black money holders is designed on the same lines as one for those having undisclosed foreign assets that was brought last year. 

It will not be mandatory to file valuation report of the undisclosed income represented in the form of investment in asset along with the declaration but the declarant should have the valuation report.#casansaar (PTI - Economic Times)
 
 
 
 

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