Sunday, September 4, 2016

Assurance of Secrecy of Declared income under Income Declaration Scheme,2016 is incomplete & unsafe 

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Finance ministry is trying it’s hard to popularize ‘Income Declaration Scheme,2016’. By the recent action through a circular dated 14.07.2016, Finance Ministry again tried to assure that no part of declared income / information will be shared with any other Govt. agency and full secrecy will be maintained.

This guarantee has been assured through existing provisions of sec. 138 of the Income-tax Act, 1961 and  a recent circular issued under sec. 138 of the Income-tax Act, 1961 but this guarantee is incomplete aswell as unsafe. As per provisions of sec. 138 read with sec. 280 of the Income-tax Act, 1961, if any income-tax authority / public servant  discloses / share  any information to any other Govt. agency / authority, such income-tax authority may suffer imprisionment of maximum 6 months  provided sanction for prosecution is granted by authorized / empowered income-tax authorities (Central Govt).

These provisions neither  guarantee that disclosurer’s information will not be utilized by any other Govt.  department / agency nor other  Govt. department / agency has been restricted to use / utilize any such information against the disclosure.

Provisions of sec. 138 of Income-tax Act, 1961 are very poor and week which can be understood by a case of ITO Rajendra Bothara, presently posted at Jodhpur. During the posting of Rajendra Bothara at Sumerpur (Rajasthan), he  not only disclosed official information of an assessee to  Excise Department, CBI and ICAI but he also converted official information / documents  in to / as his personal.

The relevant assessee (करदाता) made an application u/s 280(2) before concerned Commissioner of Income-tax-1, Jodhpur and Commissioner of Incometax, Bikaner for granting sanction to prosecute ITO Rajendra Bothara but no such sanction was ever granted. After being tired from  all exercises with Commissioners of Income-tax Department, assessee also raised the issue before Central Board Of Direct Taxes but ITO Bothara was protected at all levels by not giving the sanction for prosecution. Ultimately, assessee had to lodge a criminal case in the  Court of ACJM, Sumerpur which is presently under enquiry u/s 202 Cr.PC. During the period, assessee sufferred heavy losses / harassment and he could not get support / protection from the provisions of sec. 138 & 280 of the Income-tax Act..

This  example shows how the section 138 read with section 280 of the I.T.Act, 1961  gives the security of secrecy if any information is disclosed / leaked by any public servant  like Rajendra Bothara intentionally or unintentionally. As per present provisions,  probable prosecution of Public Servant can not be the guarantee of non-disclosure. Any prejudiced, biased, notoriuos, corrupt and enemy officer like Rajendra Bothara may disclose your information without any loss to himself.  And in any condition, punishment to any public servant can not save disclosurer-assessee from probable losses to him. Therefore,  this scheme is totally unsafe and Govt.  until suitable safety measurements are taken / inserted  – Kailash Chandra .

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