Income Tax Notices supporting 500-1000 Currency Ban – Do not worry!  

Income Tax Notices supporting 500-1000 Currency Ban – Do not worry!

People are worried these days as many Notices by Income Tax Department are getting viral in social media. But please do not worry and create the panic.

Different types of hacks are being used to escape from the black money in the form of old notes. Trust and Charitable Institutions are also participating in such scams. But now, Income Tax Department is wakeful against scams. As a result actions at different levels are being taken and notices are being issued.

Firstly, I would like to tell about the effects and legal sides of the 3 notices viral on social media –

Notice by Dy. Director of Income Tax (Mr. Norbu Bhutia), Siliguri , dated 18.11.16 : It seems that this notice has been made viral on whatsapp by an Income Tax Official intentionally. A copy of this notice has been made available below for readers’ reference.  If you read the notice carefully you will observe that no Section of Income Tax Act is mentioned therein. This notice is not only a result of eagerness of the officer but also illegal and invalid. Whosoever gets such notice should not fear / worry. No penalty can be imposed on non-adherence of such notice.

As per a research this notice is genuine but the intentions are not genuine To issue such notice for each deposit is neither valid nor honest effort. If any Income Tax Authority wants to investigate then there are sufficient provisions in law for doing so. So it would be apt that such notices are issued as per requirement under certain Sections of the Income Tax Act. CBDT should instruct subordinates also not to waste time and  energy in such small amounts in such haste.

Notice by Assistant Commissioner of Income Tax (Exemption), Jaipur (Mr. M. M. Meena) u/s 133(6)  : A copy of this notice has been made available below for readers’ reference. This notice issued under Section 133 (6) of Income Tax Act is a delayed yet good effort to curb the scams by  Trust and Religious Institutions. But even this notice is not only a result of eagerness of the officer but also illegal and invalid as it was issued without approval of respective Commissioner of Income-tax.

Notice by Asstt. Director of Income Tax (Inv.)-II, Udaipur, dated 18.11.16 u/s 131 : Many more notices have been issued by Udaipur Authority  but even such  notices are  not only a result of eagerness of the officer but also illegal and invalid.

One Advice– Now, ITD Officers will not stop and they will proceed in a way or other to curb the tax evasion. Therefore, be ready to face the ITD Officers without any tension and without going in to technicalities and protest. I would advise all the Trusts and Religious Institutions not to indulge themselves in any scam prevailing currently against the Govt. Tax evasion or conspiracy when caught will cause heavy loss to Trusts in the form of Tax and Penalty. Also Income Tax Registration u/s 12A and 80G exemption of such Trusts can come to an end forever. So it is a request to all social workers  not to indulge Trusts in any kind of Tax evasion or Conspiracy.

CA. Mukul Moondra