'Offender' may have to prove funds legal under proposed black money law

The proposed law on black money will put the onus on the suspected offender to prove the legitimacy of overseas assets, Central Board of Direct Taxes (CBDT) chairperson Anita Kapur said here on Tuesday.

Kapur told the media that the income tax (I-T) department will begin prosecution on the basis of a rebuttable presumption. "If you will not disclose the account to us, one normal presumption would be if you have a legitimate account, why will you not disclose it to us... We are going to build in a rebuttable presumption."

A rebuttable presumption is a conclusion to a fact in presence of certain evidence and can be overturned only if an evidence on the contrary is provided to.

"I don't foresee any reason if you have legitimate assets, then why you wouldn't disclose that to us," Kapur pointed out. "Of course, the principle of natural justice would prevail and offenders would get an opportunity to explain. We do recognise and feel there are principles of natural justice to be followed. Everybody will be given an opportunity and it is not the case that we are abandoning principles of natural justice."

The new comprehensive law aims to check the menace of Indians stashing black money in secret overseas bank accounts in countries like Switzerland.

Concealment of income and assets and evasion of tax in relation to foreign assets will be prosecutable with rigorous imprisonment of up to 10 years.

Further, the offence will be made non-compoundable and offenders will not be permitted to approach the Settlement Commission. Kapur further said that tightening of asset confiscation provisions under the Benami Transaction Prohibition Law and implementation of the goods and services tax will also help curb generation of black money within the country.