Modi govt's 'surgical strike' on black money: Penalty to be levied if cash deposit doesn't match income

Tightening the noose around the neck of black money holders further, the government on Wednesday warned that the cash deposited above Rs 2.5 lakh threshold in bank accounts under the 50-day window could attract tax.

Further, a 200 per cent penalty could also be levied in case the amount doesn’t match the income.

"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," Revenue Secretary Hashmukh Adhia said on Wednesday night.

"The (tax) department would do matching of this with income returns filed by the depositors. And suitable action may follow," he added.

He also said that if the amount deposited doesn’t match the income declared by the holder, it would be consider as a case of tax evasion.

"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 said.

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"small businessmen, housewives, artisans and workers 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 jewellery buying, he said that people who are buying jewellery will be required 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.