Don’t miss the latest developments in business and finance.

No immunity to those earned money through corruption: FinMin

Image
Press Trust of India New Delhi
Last Updated : May 20 2016 | 4:48 PM IST
Persons who have earned money through corrupt practices cannot take advantage of the domestic black money disclosure scheme, says the Finance Ministry's FAQ on Income Declaration Scheme issued today.
The four-month window which opens on June 1 provides an opportunity to people having undisclosed income to come clean by paying tax, penalty and surcharge totalling 45 per cent of fair market value.
The 14-Frequently Asked Questions (FAQs) further said declarations made will remain confidential as in the case of return of income filed by an assessee.
The declarant, it further said, will be liable for capital gains tax on sale of such assets in future.
On a question whether a person can declare undisclosed income which has been acquired from money earned through corruption, the FAQ said "No".
The scheme will not apply in relation to prosecution of any offense punishable under the Prevention of Corruption Act, 1988.

Also Read

"Therefore, declaration of such undisclosed income cannot be made under the scheme," it said, adding such declaration will amount to misrepresentation of facts and hence void.
As per the FAQ, if a declaration is held as void, the provisions of the Income-tax Act will apply in respect of such income as they apply in relation to any other undisclosed income.
The FAQ said it is not mandatory to file the valuation
report of the undisclosed asset along with the declaration.
"However, the declarant should have the valuation report. While e-filing the declaration on the departmental website a facility for uploading the documents will be available," it said.
The Finance Ministry said the FAQs are first part of series of taxpayer education series in the form of question and answers specifying details of the scheme and clarifying eligibility available under the same.
"These will be updated from time to time based upon feedback and further queries received," it said.
The FAQs further said the persons can declare undisclosed income for previous years regarding which no notices have been served on them by the Income-Tax Department.
"The declarant will not be eligible for declaration under the scheme where the undisclosed income relates to the assessment year where a notice ... Has been issued and served on the declarant on or before May 31, 2016," it said.
Also, in case of survey operation the person is barred from making a declaration under the scheme in respect of an undisclosed income in which the survey was conducted. The person is, however, eligible to make a declaration in respect of an undisclosed income of any other previous year.
The scheme provides an opportunity to persons who have not paid full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty of such undisclosed income declared.
The scheme is not available for undisclosed income which has been assessed to tax and the case is pending before an Appellate Authority.

More From This Section

First Published: May 20 2016 | 4:48 PM IST

Next Story