BCTT has helped track tax evasion:Govt

The controversial Banking Cash Transaction Tax (BCTT), that came into effect almost a year back, on June 5, 2005, has helped authorities unearth several cases of tax evasion, including one relating to laundering of around Rs 1,500 crore.

"Enquiries carried out by the investigation wing on the basis of BCCTT statements have led to unearthing of tax evasion in several cases," revenue secretary K M Chandrasekhar said here today.

In this connection, he cited an example of huge cash withdrawal in a branch of Federal Bank of India at Chandni Chowk in Delhi.

Noticed through the BCTT, it led the department of income tax to three entities which were carrying on the business of purchasing demand drafts from traders at a discount and helping them avoid both sales tax and income tax.

These entities would deposit the demand drafts in their own accounts and withdraw the cash, he said, adding that they had laundered around Rs 1,500 crore in a period of 18 months.

BCTT has also helped the department to detect bogus bills accomodationn entries, artificial loss claims and dummy firms, Chandrasekhar said.

The monthly BCTT statements are filed by banks before the director general of income tax (investigation), New Delhi.

Thereafter, certain bank branches are selected and the information is sent to the jurisdictional directors general income tax (investigation) to carry out further investigation.

The government has mopped-up Rs 266.88 crore during the first 8 months of  the last fiscal after the levy came into effect.