Rs 21,000-cr undisclosed income unearthed in 2 years

Evasion of Rs 50,000 crore of indirect taxes and undisclosed income of Rs 21,000 crore had been unearthed in the past two years, the finance ministry said on Tuesday.

Listing steps by the government to tackle black money, the ministry said in a statement laws like the Undisclosed Foreign Income and Assets Act were responsible for the development.

The Act provided a window for declaring undisclosed income abroad, which was taxed at 30 per cent with an additional 30 per cent penalty. Failure to meet the compliance timeline attracted additional penalty of 90 per cent for a total tax liability of 120 per cent on the undisclosed income abroad.

"The value of smuggled goods seized has increased to Rs 3,963 crore in the last two years, a 32 per cent increase over the two previous years," MoS for Finance Jayant Sinha tweeted on Tuesday. Prosecution rates had also risen 25 per cent, with 1,466 cases lodged, the ministry said. It added key suggestions of the special investigation team on black money chaired by former SC judge M B Shah had also been implemented.

India has no official estimate of money stashed overseas, but unofficial assessments put it between $466 billion and $1.4 trillion.

A new income disclosure scheme is set to provide a one-time window for tax evaders at home to come clean. The scheme will be open from June 1 to September 30. Finance Minister Arun Jaitley had in the Budget said the scheme would allow those with undisclosed local assets to pay tax at 30 per cent, surcharge at 7.5 per cent and penalty at 7.5 per cent.

However, the Benami Transactions Prohibition (Amendment) Bill has run into a roadblock after a parliamentary panel urged the government to frame a fresh bill instead of amending the existing income tax law.

The Standing Committee on Finance headed by M Veerappa Moily also suggested mandatory online registration of all immovable properties, linkage of Aadhaar and PAN numbers of all parties in a transaction, and sharing of data by registration authorities with central agencies like the income tax department.

The ministry said amendments had been made in the Prevention of Money Laundering Act to enable attachment of equivalent assets in India if foreign assets could not be seized in case of proceeds from crime.

"Section 8(8) has been inserted in the PMLA providing for restoring confiscated property or part thereof on the directions of the special court to claimants with a legitimate interest in the property who may have suffered a quantifiable loss as a result of the offences of money laundering," it said.

Section 132 of Customs Act, which deals with offences relating to false declaration in the transaction of any business relating to Customs, has been made a predicate offence under the PMLA to curb trade-based money laundering.

"The offence of wilful attempt to evade any tax, penalty or interest referred to in Section 51 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, has been made a scheduled offence under the PMLA," the ministry said.