Old Rs1,000 and Rs500 notes accepted for tax payment till midnight of 11 November
10 Nov 2016
Old demonitised currency notes of Rs1,000 and Rs500 denominations will be accepted for making payments towards fees, charges, taxes and penalties payable to the central and state governments, including municipal and local bodies.
This facility will be available only till midnight of Thursday, 11 November 2016.
''The central government has taken a decision that old Rs1,000 and Rs500 notes will be accepted for making payments towards fees, charges, taxes and penalties payable to the central and state governments, including municipal and local bodies. Such old notes will also be accepted for making payment of utility charges for water and electricity, etc. However, these facilities will be available only till midnight of 11 November 2016,'' a government release stated.
Meanwhile, revenue secretary Hasmukh Adhia replied to questions on action by income tax department in respect of old currency deposited in banks:
Q: A lot of small businessmen, housewives, artisans, workers may have some cash lying as their savings at home; will the income tax department ask questions if the same is deposited in banks?
A: Such group of people as mentioned in the question need not worry about such small amount of deposits up to Rs1.5 or 2 lakhs, since it would be below the taxable income. There will be no harassment by Income Tax Department for such small deposits made.
Q: Will the Income Tax Department be getting reports of cash deposits made during this period? If so, will the current threshold of reporting requirement of reporting cash deposits of more than Rs10 lakhs will only continue?
A: We would be getting reports of all cash deposited during the period of 10 November to 30 December 2016 above a threshold of Rs2.5 lakhs in every account. The department would do matching of this with income returns filled by the depositors. And suitable action may follow.
Q: Suppose the department finds that huge amount of cash above Rs10 lakhs is deposited in a bank account, which is not matching with the income declared, what would be the tax and penalty to be paid on the same?
A: This would be treated as the 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.
Q: It is believed that a lot of people are buying jewellery now, how does department plan to tackle this?
A: The person who buys jewellery has to give his PAN number. We are issuing instructions to the field authorities to check with all the jewellers to ensure that 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.
