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No witch-hunt against black money declarers: I-T Commissioner

Finance Minister Arun Jaitley on Saturday announced that undisclosed income worth Rs 65,250 crore was declared under the black money scheme by the end of September 30. 

One of the biggest positives of the government’s Income Declaration Scheme is that small businessmen who came with large declarations, according to DS Saksena, Principal Chief Commissioner of Income Tax Department Mumbai.

Also, there will be no witch-hunt for those who have declared their undisclosed income under the scheme, he added.

Below is the verbatim transcript of DS Saksena’s interview to Surabhi Upadhyay on CNBC-TV18.

Q: We remember you came on the show earlier as well and you were talking about creating the awareness and getting people to come on board. If you could share your experience in Mumbai and have we seen a lot of new taxpayers come in, non-taxpayers participated in this scheme and then therefore broaden the tax-base?

A: Not exactly. Those people who have come forward, most of them have got a Permanent Account Number (PAN) but I have seen that many of them are marginal taxpayers. They pay a very small amount, they file returns, which are hardly above the taxation limit and then they come out with very large declaration. That is one thing, which we have achieved because small businessmen or people who are only marginally taxable, if they come up with large declarations that means that their business has expanded and now they are willing to pay taxes. So this is a very positive development.

Q: Otherwise Mumbai is obviously one of the highest contributors to the country’s income tax collections — has that been true even for the Income Declaration Scheme (IDS)? 

A: I don’t have the figures of the entire nation but I think so. 

Q: Can you share any specific trends or maybe rough number for Mumbai? How successful has the scheme been here within your jurisdiction?

A: It has been very successful and much of the success lies in the effort, which we have made and the information, which we have gathered. This has been a very significant achievement. If you put aside the declarations, the department coming together as a whole, acting as a whole and people getting aware of the income tax responsibilities, this is a very positive thing, which cannot be measured in the number of rupees, which has been gathered as tax. 

Q: What do you think has worked this time? There are a lot of views: the fact that goods and services tax (GST) is anyway coming in, so you will be caught, the fact that this was never an amnesty or a voluntary scheme, there was very clear message from the tax department that if you don’t disclose now then the law will catch up. What worked, what is behind this number of Rs 65,250 crore?

A: People generally don’t like to be afraid of the law. They want to hold their head high. So they would come forward and they would disclose their undisclosed income. So that they don’t have to face the taxman with fear.

However, in our scheme, suppose someone commits a mistake now, someone doesn’t file a return of income or someone has some run-in with income tax and has some transaction, which he was not able to disclose at that time, the scheme is for such people because now they have come clean. So they will hold their head high. They will invest their disclosed income into their business, which will grow more now. 

Q: Will the process of search and sending out communication, is that going to continue even after the culmination of this scheme?

A: Definitely. We have to take our investigations to the logical end. So, suppose we have some information about someone, if we don’t verify it then why did we collect the information in the first place. So, even after the IDS is over we will still verify the information which we have by way of letters, by way of summons, by way of searches or surveys. 

Q: The fear of a witch-hunt, it was very clear that if you are declaring under IDS, you get immunity from the Income Tax Act, from the Wealth Act and the Benami Transactions Prohibition Act. Beyond this what happens? What is the message that you would like to now send out? If someone has come in and declared up till midnight last night, will the tax man not launch a witch-hunt? Can that be taken as a given?

A: No, there will not be any witch-hunt because this information is fully protected. It is protected in the Income Tax department itself because it is not shared with anyone. It is not at all shared with the other departments. 

Q: In terms of manpower, technology, do you have everything that is required?

A: Manpower is an issue. We are slightly short but so far as the will to act and the technological savvy which is required, that we have got in abundance and I think that would make up for manpower at the present juncture.