Demonetization drive initiated in the month of November was way more than just flushing out old currencies – It was mainly to nail down those individuals and businesses which are resorting to tax evasion. And the action against this black money trail is about to begin with a massive scale.
Govt. has identified 9 lakh firms out of 16 lakh registered businesses in India, which have never paid any income tax. And if we believe incoming reports, then strict action would be taken against them. Approximately Rs 1238 crore have been deposited within these 9 lakh companies between November-December, and Govt. is in no mood to give them any more chance.
And the base of this massive tax fraud are shell companies which have mushroomed, especially after the demonetization drive.
#BureDin for Shell Companies?
To start with, Serious Fraud Investigation Office (SFIO) has filed FIR against 49 shell companies, and the charge against them is cheating the National Exchequer of tax.
Along with The Central Board of Direct Taxes (CBDT), SIT, Income Tax Department, Enforcement Directorate, SEBI and The Institute of Chartered Accountants of India (ICAI) have joined forces to identify 559 beneficiaries, belonging to these 49 shell companies which have efficiently but illegally laundered Rs 3900 crore with the help of 59 professionals.
In fact, Enforcement Directorate has already initiated action under Prevention of Money Laundering Act (PMLA), 2002 whereas ICAI is initiating disciplinary action against its professionals which have helped these shell companies.
Benami Transactions (Prohibition) Amendment Act, 2016 would be executed against these companies, besides freezing their bank accounts and striking their names off the registry of companies.
Income Tax Dept. had earlier identified 1.36 crore Indians who are evading tax, and resorted to social media mining for discovering them. IT Laws are being amended to make the process of ‘raids’ even more easier.
Its definitely #buredin for tax evaders.
Honest Taxpayers Will Be Treated With Dignity
In view of intense scrutiny of all businesses and citizens by IT officials, there has been a concern about harassment of public at large.
In order to avoid such a scenario, CBDT has explicitly asked all tax officials to treat honest taxpayers with respect and dignity.
In a letter addressed to all officials, CBDT Chairman Sushil Chandra has said, “While pursuing the path of revenue mobilization, which is an integral part of our core work, we must always keep in view the assurance given by the Finance Minister that all honest, tax compliant persons will be treated with dignity and courtesy..”
The letter also asks all officials to pursue the “path of Revenue, Accountability, Probity, Information and Digitisation (RAPID)”, as mentioned by PM Modi and FM Arun Jaitley.
Govt. wants Income Tax Dept. to improve it’s image and perception infront of Indian citizens, and wants them to make India a nation with “progressive tax policy, efficient and effective administration and improved voluntary compliance..”
But at a time when only 24 lakh Indians declared income of more than Rs 10 lakh, while at the same time, 1.25 crore cars were sold, it is indeed a great concern as to how more Indians can be encouraged to pay their taxes.
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