New Delhi, February 2, 2018

Direct tax collection target for the current financial year will be surpassed: Sushil Chandra

The Income Tax Department has issued a “few lakh” notices to those who have put money in bitcoins and it is working to collect taxes that are due on these investments, the CBDT chief said.

CBDT Chairman Sushil Chandra told PTI that it has come to the notice of the taxman that while many such investors “did not pay advance tax” on the benefits that have accrued to them, some others have not explained the investments in their tax returns in the past.

The department had conducted pan-India surveys at these exchanges in December last year.

“We have issued notices (to investors) and they (many of them) have agreed to pay taxes. We will definitely take taxes as far as the money is concerned which is invested (in bitcoins trade) and is unexplained,” he said.

When asked about the number of such notices, the CBDT boss said that “they are in few lakhs”.

Finance Minister Arun Jaitley, in his Budget speech, had said that all types of crypto-currencies, including bitcoins, are illegal and the government will take all measures to eliminate their use.

Direct tax collections

In a reply to another question, Chandra said he was confident that the department will not only meet but will also surpass the direct taxes collection target for the current financial year. “I think the economy is very buoyant. The last quarter of advance tax payments will be much better than the third. With this particular trend when the economy is going up, the GDP is going up in the last quarter and the economy is doing better and there are no negatives, we will definitely get much better advance tax.

“Therefore, I think growth should continue at the same pace. We will definitely beat the target (of direct tax collections),” the CBDT chief said.

The I-T Department has a target of collecting Rs.9.8 lakh crore revenue from direct taxes by the end of this fiscal (March 31).

The survey operations conducted by the taxman on bitcoin exchanges, under Section 133 A of the Income Tax Act, were undertaken to “gather evidence for establishing the identity of investors and traders, the transactions undertaken by them, identity the counter-parties, related bank accounts used, among others,” sources had said.

A survey action under the I-T law pertains to tax officials making a surprise visit to the business premises of the affected party but not their residences.

Last year, Jaitley had informed Parliament that there were no regulations governing virtual currencies in India and the RBI had not given licence to any entity/company to operate such currencies.

The government in December cautioned investors to be wary of virtual currencies like bitcoin, saying they resembled Ponzi schemes with no legal tender and protection.

[The Hindu Business Line]