Tax department will not hound small depositors: Arun Jaitley on demonetisation

"It's only people with large amounts of undisclosed monies who will have to face the consequences under the tax laws," Arun Jaitley said at the Economic Editors' conference.

By: PTI | New Delhi | Updated: November 10, 2016 6:31 pm
demonetisation, jaitley, arun jaitley, Rs 500 note, Rs 2000 note, narendra modi, cash crunch, new rs 2000 note, new rs 500 note, business news Finance Minister Arun Jaitley addresses media at the National Media center in New Delhi on Wednesday. (PTI Photo by Manvender Vashist)

Assuring people that taxman will not hound those making small deposits in scrapped Rs 500/1,000 currency, Finance Minister Arun Jaitley today advised them not to throng banks as there is enough time to exchange the junked notes. He said however that those depositing large amounts of unaccounted money will have to face the consequences under tax laws, which provide for tax and a 200 per cent penalty.

“With regard to people making small deposits, nobody will face any question or harassment of any kind. People who have small amount of cash at home for exigencies and emergencies, they can deposit that in their account. And the revenue department is not going to take notice of small depositors,” Jaitley said.

WATCH VIDEO: Banks, Post Offices See Long Queues Of People For Exchange Of Rs 500, Rs 1000 Notes

He added that deposits within the tax exempted limit can always be made within the banking system without any questions being asked.

“It’s only people with large amounts of undisclosed monies who will have to face the consequences under the tax laws,” Jaitley said at the Economic Editors’ conference.

Revenue Secretary Hasmukh Adhia said Wednesday that only cash deposits of over Rs 2.5 lakh in bank accounts will be scrutinised by the tax department and in case of mismatch with I-T returns, tax plus 200 per cent penalty would be levied.

The government has allowed citizens to deposit in their bank accounts old currency of Rs 500 and Rs 1,000, which has been declared invalid in the country’s biggest crackdown on black money, corruption and counterfeit notes, between November 10 and December 30.

WATCH VIDEO: People Que Up At Banks To Exchange Rs 500 & Rs 1000 Notes: Here’s What They Said

On whether the demonetisation of Rs 500/1000 notes will help weed out black money, Jaitley said this is not an isolated initiative and the decision has to be seen in the backdrop of various steps being taken including GST roll out. “You will have the currency squeeze that will take place because a lot of static currency is not going to come back into the market. You have the GST which will be implemented, which is a far more effective system where tax evasion will be much lower and compliance will be much higher. You have parallel movement to rationalise your direct tax rate,” he said.

For all the latest Business News, download Indian Express App

  1. A
    Aroon
    Nov 10, 2016 at 1:33 pm
    Badly planned as there are not enough new notes supplied to banks. Cut of limit was Rs.4000 per person.There was not even enough for 1000 per person in new notes as most bank branches ran out of reserve and some didn't even start. Some persons travelling had no way to get money as their home banks refused to even send messages confirming their account status.
    Reply
    1. D
      Dash
      Nov 10, 2016 at 1:43 pm
      Except corrupt men and womwn,jihadis and jihadi sympathizers,everyone else is happy.lt;br/gt;Modi never does anything without immaculate planning. Corrupt politicians citing poor men must find some other excuse to criticze Modi. Jan Dhan accounts,PAN card issue wrt jewellery erc. are linked to this. Jihadi Mamata,Khujliwal,Pappu etc. have lost a lot after this move by the PM. Their frustration says a lot about their motives and integrity.
      Reply
      1. B
        bharatShakti
        Nov 10, 2016 at 1:50 pm
        be careful...lt;br/gt;lt;br/gt;govt wants 200% of your money, using excuse of penalty??lt;br/gt;lt;br/gt;what if one saved, after years of slaving work in india,lt;br/gt;for his mother,lt;br/gt;for his wife,lt;br/gt;for his daughters marriages?lt;br/gt;lt;br/gt;is he criminal, as per govt?lt;br/gt;lt;br/gt;is taking care of your family, now its criminal, as per govt?lt;br/gt;lt;br/gt;shud we leave and break our families, and live like Modi lifestyle??
        Reply
        1. B
          bharatShakti
          Nov 10, 2016 at 1:46 pm
          ये जो कल से ५०० और १००० के नोट बंद होने की खबर सुनकर,lt;br/gt;lt;br/gt; महिलाओं के जमा पैसे को कालाधन बताने वालो से कहना है,lt;br/gt;lt;br/gt; कि वो पैसा कालाधन नहीं....lt;br/gt;lt;br/gt;आपकी मेहनत और सूझबूझ से बचाया हुआ धन है....lt;br/gt;lt;br/gt;अपने परिवार की आपातकाल में मदद करने के लिये जमा किया है....lt;br/gt;lt;br/gt;🕉lt;br/gt;किसी माँ ने अपनी संतान के लिये....lt;br/gt;lt;br/gt;किसी पत्नी ने अपने पति के लिये....lt;br/gt;lt;br/gt;तो उनका मजाक ना बनाये....lt;br/gt;lt;br/gt;उनके जमा धन में कुछ और धन मिलाकर बैंक जाईये....lt;br/gt;lt;br/gt;नोट बदलाकर उन्हें वापस दिजिये.....lt;br/gt;lt;br/gt;देश की सरकारें आती जाती रहेंगी.lt;br/gt;lt;br/gt; पर हमारे घरों की सरकारें हमेशा हमारी हमसफर रहेंगी...lt;br/gt;🕉
          Reply
          1. C
            Citizen
            Nov 10, 2016 at 3:37 pm
            they will not har billionaires who funded election campaigns...achhe din for them! Mallya on top ran away with billions of dollars....did he run away or was given a well-deserving Royal Send-Off?! How Bharat Mata must be feeling? She must be writhing in excruciating pain as oppressors tighten stranglehold on her!
            Reply
            1. M
              mathimathi
              Nov 10, 2016 at 1:08 pm
              our FM PM never recover black money. but they can Make in harm ordinary Indians in the name of some ic things upto 2019.
              Reply
              1. M
                Mohan
                Nov 10, 2016 at 12:00 pm
                This is how The FM dilutes a scheme slowly. His next announcement will be to exclude from scrutiny senior citizens , married women, then farmers, then ex- servicemen, then small traders, then self emplo advocates ... Subramaniam Swamy is correct. Our FM is the most incapable finance minister we ever had after Chidambaram.
                Reply
                1. V
                  Vihari Naidu
                  Nov 10, 2016 at 1:26 pm
                  Those who didn't get elected by people can't understand the problem of common man. Do you even realise how common Rs.500 note is....?!
                  Reply
                  1. Load More Comments