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I-T prosecutes Mumbai trader for depositing Rs 3 cr by using duplicate PAN

Shrimi Choudhary/New Delhi 20 Mar 17 | 11:59 PM

Illustration by Ajay Mohanty

The income-tax (I-T) department is planning to initiate criminal prosecution against 30 individuals for allegedly amassing undisclosed wealth of aroun Rs 500 crore during demonetisation for purposes of tax evasion.

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Of the 30 cases, the tax department has filed its first criminal prosecution against a Mumbai-based trader for allegedly using a duplicate permanent account number for depositing over Rs 3 crore. In the petition, the tax department has submitted evidence in the form of closed-circuit television footage, bank account details and transactions to the Mumbai court. 

According to the tax official, the accused had deposited cash over 10 transactions with the help of his co-workers and had also attempted to erase the deposit records from the books.

Confirming the development, a senior tax official said: “We are initiating prosecution where sufficient evidence is available. The modus operandi has varied in cases. These include cash seizures during searches to check irregularities in deposits and huge cash deposits in bank accounts, which are at variance with the tax filings." According to him, the tax department has completed the investigation in four-five major cases and will start prosecution against the said offenders this week.

The Central Board of Direct Taxes, a governing body of the I-T department, is said to have directed its field offices to not spare cases of alleged tax evasion in its searches in deposits under Operation Clean Money after demonetisation and file court cases as well.

Under the income-tax laws, a court conviction for tax offences can lead to imprisonment of up to seven years, in addition to penalty on the tax evaded. The charge sheets have been filed by the taxmen, largely under three sections of the I-T Act such as 276 CC (not filing return of income), section 276B (not depositing tax deducted at source in time) and section 276C (1) (wilful attempt to evade taxes).

 Operation Clean money

200 plus: No. of searches conducted by taxmen in the past 15 days

Rs 500 crore: Tax evasion during demonetisation (November 8, 2016-March 13, 2017)

30: No. of individuals to be tried for amassing undisclosed wealth 

5,000 plus: No. of notices issued to individuals, entities 

March 31, 2017: Black money disclosure window deadline

Sources said that the I-T wing has conducted over 200 searches in the past fortnight under Operation Clean Money and sent over 5,000 notices to individuals and entities. Meanwhile, investigation is also underway against the 1.8 million individuals who were asked to do online verification via e-filing. These individuals had come under scrutiny because their cash deposits did not match their tax profiles.

Officials said that those who want to avoid prosecution can opt for the declaration window under the Pradhan Mantri Garib Kalyan Yojana (PMGKY), ending March 31. The government had, on December 17, provided companies, firms and individuals time until March 31 to come clean on deposits of banned currency in banks after demonetisation. For those holding unaccounted cash, the PMGKY proposed to tax 50 per cent of the declared amount and park another 25 per cent in an interest-free deposit for four years. Sources said only Rs 6,000 crore has been declared so far under the black money declaration window.

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