Bank deposits worth Rs3-4 lakh crore under tax scanner

11 Jan 2017


The union government says it has unearthed a cash trove of Rs3 to 4 lakh crore that it believes to be black money channeled into bank accounts to evade taxes.

"We now have trunkloads of data; our analysis shows that sums of more than Rs2 lakh each were deposited in over 6 million bank accounts post-demonetisation. The total amount parked in these accounts is more than Rs7,34,000 crore," an official said on Tuesday.

The income tax department has been asked to analyse the data and send notices to the depositors.

However, chartered accountants are sceptical about the government's estimate, as it is suspiciously close to the projection of black money that government officials had made after the prime minister's demonetisation announcement on 8 November, according to The Telegraph.

The government had believed that this was the sum that would not come back into the banking system. Banks were, however, swamped by deposits unofficially estimated at 94 per cent of the Rs15.44 lakh crore worth of cash - or 86 per cent of the money in circulation - that was scrapped in one stroke.

Tax analysts said most of those who had made large deposits of old money in their bank accounts were likely to have legitimate answers and the necessary back-up paperwork to prove that these sums either represented what businesses categorise as cash in hand or savings from recognised and tax-paid incomes.

Analysts said tax evaders have used ingenious money-laundering methods, ranging from colluding with jewellers to buy gold trinkets supported by backdated bills and providing cash inducements to the poor to park money in their Jan Dhan accounts.

Small firms have been persuaded to inflate the amount they show as cash in hand in exchange for a monetary compensation while others have tried to mask the unaccounted wealth by paying advance salaries to their workers or providing loans to employees.

More than Rs10,700 crore cash was deposited in different accounts in some northeastern states since 9 November, an official said.

The income tax department and the Enforcement Directorate are looking into over Rs16,000 crore deposited in different accounts of cooperative banks.

The big data trawl has thrown up a few more facts: a sum of Rs25,000 crore cash was deposited in dormant bank accounts while loans worth over Rs80,000 crore were repaid in cash after 8 November.

Officials said that suspicious transactions would be verified. If the replies are not satisfactory, the tax dodgers will have to pay a penal 50 per cent tax on such cash mountains before 31 March.

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