Systemic measures by Government under Black Money Act yields results; detects undisclosed income of several crores

In the recent years, the Government has taken a number of measures to bring back the black money stashed abroad ‘The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015’. This was stated in a written reply by Union Minister of State for Finance Shri Pankaj Chaudhary to a question in Lok Sabha.

The Minister stated that as a result of systematic actions by the Government, the following results have been achieved as on 31.05.2021:

• As on 31.05.2021, assessment orders under section 10(3)/10(4) of the Black Money Act, 2015 have been passed in 166 cases, wherein demand of ₹ 8,216 crore has been raised.
• Undisclosed income of ₹ 8,465 crore (approx.) has been brought to tax and penalty of ₹ 1,294 crore has been levied in HSBC cases.
• Undisclosed income of ₹ 11,010 crore (approx.) has been detected in ICIJ (International Consortium of Investigative Journalists) cases.
• In the Panama Papers Leaks cases, undisclosed credits of ₹ 20,078 crore (approx.) have been detected.
• In the Paradise Papers Leaks cases, undisclosed credits of ₹ 246 crore (approx.) have been detected.

The Minister stated that Income Tax Department takes appropriate action under relevant laws against the tax evaders. Such action under direct tax laws includes searches, surveys, enquiries, assessment of income, levy of tax, interest, penalties, etc. and filing of prosecution complaints in criminal courts, wherever applicable.

Giving details of the number of people arrested/chargesheeted, the Minister tabled details of prosecution complaints filed during last 5 years by the Income Tax Department under Income Tax Act, 1961 are as under:

Further, more than 107 prosecution complaints have been filed under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, the Minister stated.

Giving more details of the steps taken by the Government to bring back black money from outside the country to India, the Minister stated that the following number of measures have been taken:

(i) Enactment of ‘The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015’ which has come into force w.e.f. 01.07.2015 to specifically and more effectively deal with the issue of black money stashed away abroad. Apart from prescribing more stringent penal consequences, this law has included the offence of willful attempt to evade tax etc. in relation to undisclosed foreign income/assets as a Scheduled Offence under the Prevention of Money- laundering Act, 2002 (PMLA).

(ii) Constitution of the Special Investigation Team (SIT) on Black Money under Chairmanship and Vice-Chairmanship of two former Judges of Hon’ble Supreme Court,

(iii) Proactively engaging with foreign governments with a view to facilitate and enhance the exchange of information under Double Taxation Avoidance Agreements (DTAAs)/Tax Information Exchange Agreements (TIEAs)/Multilateral Conventions.

(iv) India has been a leading force in the efforts to forge a multi-lateral regime for proactive sharing of financial information known as Automatic Exchange of Information which will greatly assist the global efforts to combat tax evasion. The Automatic Exchange of Information based on Common Reporting Standard has commenced from 2017 enabling India to receive financial account information of Indian residents in other countries.

(v) India has entered into information sharing agreement with the USA under the Foreign Account Tax Compliance Act of USA.