Income Tax Department organises meeting to promote Income Declaration Scheme

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Srinagar :-Aayakar Parivar Anantnag today organized a meeting with the members of Tax Bar Association Anantnag and members of All Traders and Manufacturers Association Anantnag-Kashmir to familiarize them about the Income Declaration Scheme (IDS), 2016 formulated by Income Tax Department.

The Scheme provides an opportunity to persons who have paid not full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty totalling in all to forty-five per-cent of such un-disclosed income declared.

In the meeting, Manzoor A Shah, Income Tax Officer, Anantnag informed the office bearers of Trader(s) and Manufacturer(s) Association(s) and CAs   about the Scheme as under:

Salient features of Scheme

•        Scheme to apply to undisclosed income whether in form of assets or otherwise pertaining to F.Y. 2015-16 or earlier years. The Scheme is available to every person, whether resident or non-resident.

•        In respect of undisclosed income in the form of assets, Fair Market Value of the asset as on 01-6-2016 deemed to be the undisclosed income.

•        The person making a declaration under the Scheme would be liable to pay tax at the rate of 30% of the value of such undisclosed income as increased by surcharge at the rate of 25% of such tax .In-addition, he/she would also be liable to pay penalty at the rate of 25% of such tax. Therefore, the declarant would be liable to pay a total of 45% of the value of the un-disclosed income declared by him/her.

Immunity

•        Assets declared are exempt from Wealth-tax

•        No scrutiny/enquiry under Income Tax Act/Wealth Tax Act in respect of such declarations.

•        Immunity from Prosecution under Income Tax Act/Wealth Tax Act.

•        Immunity from Benami Transactions (Prohibition) Act, 1988 subject to certain conditions.

Compliance Window

•        Declaration to be made from Ist June,2016 to 30th September,2016

•        Tax, Surcharge and penalty to be paid:  By 30th November,2016.

Mode of making declaration

•        To be filed online      OR

•        In print form to jurisdictional Pr.Commissisosner of Income Tax J&K Jammu.

         Clarificatory notes on the Scheme

•        It is mandatory for Declarant to furnish PAN in the form of declaration.

•        Declarant will be liable for Capital Gains on sale of such un-disclosed assets in future. The cost of acquisition for the purpose of   

         Capital Gains shall be fair market value as on 1.6.2016.

•  Person will be ineligible for the scheme for those Assessment year(s) for which a notice under section 142(1)/143(2)/148/153A/153C is issued on or before 31.5.2016 and the proceeding is pending before the Assessing Officer ,and also in whose case proceedings before the Settlement Commission are pending.

The person is also not eligible to make a declaration under the Scheme if a search has been initiated and the time for issuance of notice under section 153A has not expired, even if, such notice for the relevant Assessment year has not been issued.

• Where investment in any asset is partly from an income which has been assessed to tax, the un-disclosed income represented in form of such asset will be the fair market value of the asset determined in accordance with Rule 3 as reduced by an amount which bears to the value of the asset as on the 1.6.2016, the same proportion as the assessed income bears to the total cost of the asset.

• The Declarant is not entitled to re-open any assessment or reassessment made under the Income Tax Act. However, he can declare other undisclosed income for the said Assessment Year which has not been assessed under the Income Tax Act.

• In-case of survey operation the person is barred from making a declaration under the Scheme in respect of the Assessment year in which the survey was conducted and time limit for issuance of  notice of assessment has not expired.

•   Where a search/survey operation was conducted and the assessment has been completed but certain income was neither disclosed nor assessed, such un-assessed income can be declared.

•   A person cannot make a declaration under the Scheme, if his undisclosed income has been acquired from money earned through corruption.

•  The scheme incorporates the provisions of section 138 of the Income Tax Act relating to disclosure of information in respect of assesses. Therefore; the information in respect of declaration made is confidential as in the case of return of income filed by the assessee.

•   Non-payment of total taxes, surcharge & penalty in time or declaration by misrepresentation or suppression of facts shall render the declaration void

• Cases where summons  under section 131(IA) have been issued by the Department or letters for enquiry under NMS or under section 133(6) are issued but no notice under section 142 or 143(2) or 148 or 153A or 153C [ as specified in section 196(e)] of the Finance Act,2016 has been issued are eligible for the scheme.

• It is necessary for the Declarant   to obtain the valuation report but it is not mandatory for him to attach the same with the declaration made in form-1.However, the jurisdictional Pr. Commissioner /Commissioner in order to ascertain the correctness of the value of the asset quoted in form -1 may require the declarant to file the valuation report before issuing the acknowledgement in form-2.

There was word of caution, as already declared by the PM of India  that this scheme  may be treated as the last opportunity for those sleeping over the black money after which no such amnesty will be granted in future and the Income Tax Department will be at liberty to deal with such tax defaulters as warranted by the Income Tax/Wealth Tax Act.

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