Deposits above Rs.2.5 lakh to invite penalty on income mismatch

The Government has warned that the cash deposits above 2 lakh 50 thousands rupees threshold under the 50-day window can attract tax plus a 200 percent penalty in case of income mismatch, said Revenue Secretary Hashmukh Adhia.

In a series of tweets, he said, government will get reports of all cash deposited during the period of 10th November to 30th December above a threshold of 2.5 lakh rupees in every account. He said, the department will do matching of this with income returns filed by the depositors and and suitable action may follow. 

He said, any mismatch with income declared by the account holder will be treated as a case of tax evasion. Mr Adhia said, if cash amount of above 10 lakh rupees is deposited in a bank account, not matching with declared income,same will be treated as tax evasion.

The government has allowed citizens to deposit in their bank



accounts old currency of 500 and 1,000 rupees denominations, which had been declared invalid in the nation's biggest crackdown on black money, corruption and counterfeit notes, between November 10 and December 30. 

The Revenue Secretary said, small businessmen, housewives, artisans and workers who had some cash lying as their savings at home should not be worried about any tax department scrutiny. On people resorting to buying of jewellery, Mr Adhia said, persons buying jewellery have to provide their PAN number.

He said, instruction in this regard have been issued to field authorities. He said, action will be taken against those jewellers who fail to take PAN Numbers from buyers to ensure the requirement is not compromised. He said, cash deposit of jewellers will be scrutinized against the sales made to check whether they have taken PAN numbers of buyers or not.