Proof of tax paid, 4-yr money lock-in must to avail of PMGKY

proof-of-tax-paid-4-yr-money-lock-in-must-to-avail-of-pmgkyNEW DELHI: Black money holders keen to avail of the new tax evasion amnesty scheme will have to first deposit 49.9 per cent tax and park a quarter of their unaccounted cash in zero-interest deposit before being able to apply for it.

The Pradhan Mantri Garib Kalyan Yojana, 2016, which provides last chance to holders of undisclosed income in the form of old 500 and 1,000 rupee notes to come clean, will not be applicable to any person facing prosecution for corruption, holding benami property, money laundering, violation of foreign exchange or drug trafficking.

In a clarification on Provisions of the Taxation and Investment Regime for PMGKY, CBDT said the scheme will not be applicable to anyone facing charges under the Foreign Black money Act.

“The provisions of this scheme shall not apply in relation to any person in respect of whom an order of detention has been made under the Conservation of Foreign Exchange and Prevention of Smuggling Activities Act, 1974,” it said.

This is also not applicable to cases of detention orders in relation to prosecution for any offence punishable under the Narcotic Drugs and Psychotropic Substance Act, 1985, the Unlawful Activities (Prevention) Act, 1967, the Prevention of Corruption Act, 1988, the Prohibition of Benami Property Transaction Act, 1988 and the Prevention of Money-Laundering Act, 2002.

Additionally, the provisions will not cover “any person notified under Section 3 of the Special Court (Trial of Offences Relating to Transactions in Securities) Act, 1992”.

CBDT promised that the content of the declarations made shall not be admissible as evidence against the declarant under any Act other than the exceptions listed above.

IT said that upon making a valid declaration, the amount of undisclosed income declared will not be included in the total income of the declarant under the Income Tax Act for any assessment year.

“A declaration shall be void and shall be deemed never to have been made where a declaration has been made by misrepresentation or suppression of facts or without payment of tax and surcharge of penalty or without depositing the requisite amount in the PMGKY Deposit Scheme, and in such cases, all the provisions of the Income-Tax Act, including penalties and prosecutions, shall apply accordingly,” it said.

The scheme provides an opportunity to persons having undisclosed income in the form of cash or deposit in an account maintained with a specified entity (which includes banks and post office) to declare such income and pay tax, surcharge and penalty totaling in all to 49.9 per cent of such declared income.

Besides, the scheme provides that a mandatory deposit of not less than 25 per cent of such income shall be made in the zero-interest bearing Pradhan Mantri Garib Kalyan Deposit Scheme, 2016, for four years.

It commenced on December 17 and shall remain open for declarations and deposits up to March 31, 2017.–PTI

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