New Delhi, March 22, 2017

Eighteen lakh entities deposit scrapped notes of Rs 500, Rs 1000 not in line with their income means

Action will "definitely" be taken against 9.29 lakh entities who have not responded to the Income Tax (I-T) department's queries over cash deposited by them which did not match their income profile, the government asserted on Wednesday.

During the 50-day period post-demonetisation, 18 lakh entities deposited scrapped notes of Rs 500 and 1000 not commensurate with their income means, Finance Minister Arun Jaitley said in the Lok Sabha in reply to a debate on the Finance Bill.

"Currently, the process of remonetisation is on. But through data mining, CBDT and tax department have found out from the first cut analysis that cash deposited by 18 lakh people did not match with their income profile," he said.

The authorities had sought explanation from these 18 lakh entities through SMS and emails, he said.

"About 8.71 lakh people have sent their explanations and those who have not responded, the Income Tax Department will take action against them as per the Income Tax Act," he said.

"Those who have not responded, definitely the Income Tax Department will take action," the Finance Minister said.

Citing the benefits of demonetisation which the opposition continues to question, Jaitley said it will help boost resources of the government.

Members of every party expresses concern that there should be more funds for farmers, defence, MNREGA, he said, adding higher spending by the government can be possible only when they have more resources.

"If we remain a largely tax non-compliant society, if a campaign is launched against every effort to improve upon that standard, then how can the higher resources be mobilised for farmers, soldiers, army preparedness etc?... The objective of the government to eliminate the anonymity of cash has been achieved," he said.

Demonetisation will help promote formal economy, process of digitisation and enhancement of banks' lending capacity and the country is marching toward this direction, he said.

Responding to questions over the final tally of deposits received during the demonetisation period, the Finance Minister said it will be announced by RBI after every note is counted.

"RBI is counting each and every note by pulling out fake currency and when they get the accurate figure, they will release it," he said.

[The Business Standard]