Taxmen investigating hidden assets overseas; several high net worth individuals on radar

The Income Tax Department is investigating cases involving foreign bank deposits and purchase of properties overseas by "thousands of Indians" as part of a major crackdown to unearth black money, senior officials disclosed on Monday. The I-T Department is likely to make use of the new anti-black money law for strict criminal action in such cases, officials said.

CBDT chairman Sushil Chandra confirmed that the investigations were on but refused to divulge details. Officials, however, disclosed that vital information pertaining to overseas transactions of several high net worth individuals had been provided by the financial intelligence unit (FIU) and other sources and action had been initiated with the authorities of various countries in which these assets were located.

In a number of cases, notices have been issued to individuals or business entities to explain their transactions, the officials said. However, only those cases will face criminal action under the new anti-black money law which have not been reflected before the taxman in the income tax returns (ITRs) or have been done with an intent to evade taxes, they said. The government notified the new law - The Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act - in 2015.

The new legislation deals with cases of overseas illegal assets, which till recently were probed under the Income Tax Act, 1961. This new legislation has provisions for a steep 120 per cent tax and penalty on undisclosed foreign assets and income, along with a jail term of up to 10 years.

The CBDT chairman said the department will ensure that the honest taxpayer is facilitated and helped at all times, while there will be strict legal and prosecution action against tax evaders. "We are using a lot of data analytics and non-intrusive ways to check tax evasion. The department is committed to bring more and more easiness and transparency for the taxpayers while dealing with the department," Chandra added. He said that the contribution of direct taxes to the total revenue kitty in the country is the highestand stands at 52 per cent at present.

The board also said that there has been a regular growth in direct tax-GDP ratio over the last three years and the ratio of 5.98 per cent in financial year 2017-18 is the best in the last 10 years. The department has also sent about 1.85 crore emails and SMSes to assessees and taxpayers during the last quarter of the last fiscal 2017-18 (January-March), asking them to file their ITRs. Both the number of salaried and non-salaried categories of taxpayers in the country as well as the average income declared by them has increased over the past three years, according to the CBDT statement issued on Monday.

The number of salaried and non-salaried taxpayers saw an increase between 2014-15 and 2017-18 assessment years and it was a result of continuous efforts of the department initiated for widening and deepening the taxpayer base in the country, it said. During a three-year period the number of salaried taxpayers has increased from 1.70 crore in 2014-15 to 2.33 crore 2017-18. This is a rise of 37 per cent.

Also, the average income declared by the salaried taxpayers has gone up by 19 per cent from Rs 5.76 lakh to Rs 6.84 lakh, the CBDT said. During the same period, it said, there has also been a growth of 19 per cent in the number of non-salaried individual taxpayers from 1.95 crore to 2.33 crore and the average non-salary income declared has increased by 27 per cent from Rs 4.11 lakh in 2014-15 to Rs 5.23 lakh in 2017-18.

Talking about the corporate taxpayers, it said the average tax paid by this category of assessees has increased from Rs 32.28 lakh in 2014-15 to Rs 49.95 lakh in 2017-18, which is a growth of 55 per cent. The number of people who file tax returns has also increased by about 65 per cent during this period from 3.31 crore in FY 2013-14 to 5.44 crore in 2017-18 fiscal, the CBDT said in the statement.

It said that a growth of more than 80 per cent has been registered vis-a-vis the number of returns filed in the last four financial years - from 3.79 crore in 2013-14 to 6.85 crore in 2017-18.