Reform in Bharath in 2017
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Transcript of Reform in Bharath in 2017
DEMONETIZATION - 2016
I-T-Raids
BENAMI PROPERTY
BHARATH
“Black Money is the aggregate of incomes which are
taxable but not reported to authorities.”
• 2015: ‘The Black Money (Undisclosed Foreign Income and
Assets) and Imposition of Tax Act, 2015’ has become
functional.
• Black money is a serious problem, which needs strict
handling of laundering black or untaxed money.
• It needs to be brought into the economic mainstream.
• Stringent penalties are applicable under money laundering
legislations globally.
DEMONETIZATION NOTIFICATION
To curb financing of terrorism through the proceeds of Fake
Indian Currency Notes (FICN) and use of such funds for
subversive activities such as espionage, smuggling of arms,
drugs etc., into India, and for eliminating Black Money which
is a shadow of parallel economy on our real economy, it is
decided to cancel the legal tender character of the High
Denomination bank notes of Rs.500 and Rs.1000
denominations issued by RBI till now. This will take effect from
the expiry of the 8th November, 2016.
CASH VS DIGITAL
• Fake currency possible when cash is used for day to day
transactions and banking transaction is avoided.
• Informal savings are made formal by demonetization
as banks channel these for productive purposes.
• Modes of digital payments are: Unstructured
Supplementary Service Data (USSD), Aadhaar enabled
Payment System (AEPS), Unified Payments Interface
(UPI) and RuPay Cards.
CONDUCTING INCOME-TAX RAIDS
• Tax noncompliance is a range of activities that are
unfavorable to a state's tax system.
• This may include tax avoidance, which is tax reduction by
legal means, and tax evasion which is the criminal non-
payment of tax liabilities.
• The use of the term 'noncompliance' is used differently by
different authors. Its most general use describes non-
compliant behaviors with respect to different institutional
rules resulting in unobserved economies.
POST DEMONETIZATION I-TAX RAIDS
• Income tax and police raids across the country have caught
everybody's attention with the authorities seizing large stashes
of new Rs. 2,000 notes.
• Given that the new banknote is being carefully rationed, the
raids have raised some serious questions about how these
people have managed to get hold of so much of the new
currency.
• Within days of the announcement of the note ban, two people
were arrested with Rs 3.5 crore in New Delhi.
RAIDS OF I-T DEPT. - SINCE DEMONETIZATION
• Over 13 crores seized in New Delhi: Income Tax officials
and Delhi Police on December 10 raided the office of a law
firm T&T in southern part of the national capital and found
over Rs. 13 crore in cash, of which Rs. 2.5 crore was in
new currency notes.
• The Crime branch team found 7 crores in old Rs 1,000
rupee notes, 3 crores in Rs. 100 denominations, and the
rest a mix of old and new notes.
Chennai: Around 166 crore currency seized. On December
10, the I- Tax department seized 24 crore rupees cash in new
notes in Chennai. This comes after a haul of cash and gold
post demonetization in the city, in which over Rs 142 crore
unaccounted assets were recovered.
Hyderabad: In Hyderabad, CBI busted a note exchange
racket by recovering 65 lakh rupees of new 2000
denomination notes from the Senior Superintendent of Post
Offices.
Challakere, Karnataka: In another development, on December
10, the Income Tax department zeroed in on 5.7 crore rupees
cash in new notes. Besides 32 kgs of Bullion (gold biscuits)
and old notes worth 90 lakh rupees was stashed inside
bathroom tiles of a Hawala operator in Challakere town in
Karnataka.
The department officials laid their hands on the stash on the
basis of searches that began against casino and bullion
traders in Hubballi and Chitradurga districts on December 9.
Vellore, Tamil Nadu: On December 9, a seizure took place
in Vellore where Rs 24 crore in cash was recovered. Rs
2,000 currency notes, kept in 12 boxes, were seized from a
car.
Poll bound states of UP and Punjab: In Punjab, fake
currency with face value of 4.15 lakh rupees was seized in
Sangrur. In Uttar Pradesh, Enforcement Directorate
reportedly found huge amount of cash in a raid at the ruling
Samajwadi Party MLC Santosh Yadav's house.
Bhilwara, Rajasthan: In yet another raid on December 10,
Income Tax Department seized Rs 7, 20, 000 in new Rs
2,000 currency notes from Bhilwara, Rajasthan.
Surat, Gujarat: In Surat, on December 9, Income Tax
officials raided different locations in the city and found Rs
1.57 crore in the form of new currency notes issued by
the government after demonetization.
Goa: The CBI and local police arrested eight persons and
confiscated Rs 1.5 crore worth of new currency in Goa on
Dec. 7.
• Raid at former BJP leader's house in West Bengal: On
December 6, former BJP leader Mahesh Sharma from
West Bengal was arrested by the special task force. Rs 33
Lakh in form of Rs 2,000 notes was confiscated from him.
• Four bank officers were accused by the police of
converting black money after Rs. 5.7 crore cash was
seized from a hawala operator.
• While there is less than adequate number of Rs. 500 and
2,000 notes, crores in new cash has been found in raids
across the country over the past few weeks.
CRACKDOWN ON BLACK MONEY- CHENNAI
• I-T raid at Tamil Nadu Chief Secretary Rammohan Rao's
son's office; 33 crore in new currency seized.
• According to India Today report, during the search
operations which had commenced yesterday (21-12-2016),
around Rs 30 lakh and 5 kg gold were recovered from
Rao's residence.
• Significantly, along with the cash and bullion, 40 valuable
documents were also seized.
AXIS BANK - OVER RS 60 CRORE DEPOSITED
IN ACCOUNTS OF 20 FAKE COMPANIES
• The Income Tax department on Thursday (22/12) raided
an Axis bank branch in Noida sector 51 and reportedly
found out accounts belonging to 20 fake companies.
• According to a report, over Rs 60 crore was deposited in
those accounts. This came days after raid was conducted
at an Axis Bank branch in Delhi's Chandni Chowk.
AXIS BANK AND OTHER FAKE ACCOUNTS
• According to reports, I-T officials had said that about Rs 100
crore in old notes had been deposited in the accounts since
November 8, the date of the announcement of demonetization
by Prime Minister Narendra Modi with an objective to curb
down the flow of black money in the country.
• The officials told NDTV that these 44 fake accounts had been
created by the usage of forged documents. they said that the
investigators suspected that the money might have been routed
to buy gold.
• This is the second such raid to have been reported at a branch of
Axis Bank. Earlier last month, I-T officials had nabbed two people
with Rs 3.5 crores of cash in new currency notes while they tried
to come out of the Kashmere Gate branch in Central Delhi.
• The government had said that any deposit that amounted more
than Rs 2.5 lakh would come under the scrutiny of the Income Tax
department.
• The centre had also given the people with the outlawed and
untaxed notes one last opportunity and asked them to deposit the
amount in their accounts and pay half the taxes and penalty
CASH CRUNCH HITS RURAL INDIA HARDER
• New Delhi: The withdrawal of the high value currency notes
has hit rural India harder than the rest of the country.
• The about 25 crore accounts in the regional rural banks
received just Rs. 8000 crore in fresh currency from Nov. 10
to Nov. 30.
• This works out to be a little less than Rs. 350 per account
holder. Rural bankers persuade customers to seek only as
much cash as they immediately need.
IN THE LONG TERM, IT BENEFITS PEOPLE
• The finance Minister said that ‘Demoni’ benefits would be felt in the long run due to its good effect on the economy although it carries the pain in the transition.
• There would be better GDP, cleaner ethics and cleaner economy.
• The F M admitted that there was a shortage of cash and that was what made the parallel shift to electronic transactions so important. India will move digital. There will be increased money in the banking system, increasing abilities of banks to support the economy.
Terming demonetization a "monumental tragedy" and an "anti-
poor" measure, former F M, P Chidambaram today said. "I
don't think demonetisation is a reform. It is a monumental
tragedy which is anti-poor and has put millions in misery and
hardships," he said.
All cash is not black money; Agricultural income is not subject
to taxation, income of charities is exempted, as is the income
of religious trusts. Also, the people of Northeastern states do
not have to pay income tax and they have cash in hand, he
said.
BENAMI- PROPERTY WHICH LACKS THE OFFICIAL
OWNER'S NAME
• Parliament had passed the Benami Transactions
(Prohibition) Act, and the rules and provisions of the
Benami Transactions (Prohibition) Act came into
force on November 1, 2016.
• The existing Benami Transactions (Prohibition) Act,
1988, was renamed as the "Prohibition of Benami
Property Transactions Act, 1988".
• Benami Property Transactions Act, 1988 has been
amended by the Benami Transactions (Prohibition)
Amendment Act, 2016 (BTP Amendment Act).
• The rules and all the provisions of the BTP Amendment Act
shall come into force on 1st November, 2016.
• After coming into effect of the BTP Amendment Act, the
existing Benami Transactions (Prohibition) Act, 1988 shall
be renamed as Prohibition of Benami Property
Transactions Act, 1988 (PBPT Act).
• The PBPT Act defines benami transactions, prohibits them
and further provides that violation of the PBPT Act is
punishable with imprisonment and fine.
• The PBPT Act prohibits recovery of the property held
benami from benamidar by the real owner.
• Properties held benami are liable for confiscation by the
Government without payment of compensation.