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Rs. 3700 Crores declared by 638 Indians Having Abroad Bank Accounts Is Now White. These People Can Sleep, Jaitley said.

Prime Minister Narendra Modi had announced this Independence Day that the government had received undisclosed foreign assets declarations worth Rs 6,500 crore. On Thursday, experts attributed the tepid response to the much-publicised, one-time opportunity to concerns that the information provided may not remain confidential or that it may be used by investigative agencies to probe inter-related transactions. 

Jaitley added: “Now under the new black money law, this is the third set of cases where we gave the compliance window where 638 people have come and said ‘I have foreign assets’… They will be assessed accordingly and these people can sleep, by and large, in peace now. Over and above, if somebody is found having black money abroad and we have evidence against him, then he will now face the new law. He will have to pay tax of 30 per cent plus 90 per cent penalty. A total of 120 per cent tax and penalty and the whole thing will be confiscated and he will be liable for prosecution which may have 10 years of imprisonment.” 

The disclosed amount announced by the Government translate into an average of a measly Rs 6 crore per declarant, lending credence to the belief that most of the big evaders have chosen not to comply. 

The Government can now expect to rake in tax worth over Rs 2,200 crore on the amount declared. “These figures are subject to final reconciliation. The e-filing portal was also open till midnight to receive the declarations,” the Central Board of Direct Taxes (CBDT) said in a statement. 

“Lack of trust in respect to keeping the information strictly confidential, onerous disclosures and valuation rules and insufficient time given to taxpayers have contributed to this,” said Amit Maheshwari, managing partner, Ashok Maheshwary & Associates.

Jaitley, meanwhile, said that the Government will now scale up its efforts to curb the generation of illegal money abroad — and even in India. 

Asked to compare the current effort with a similar scheme nearly a decade ago, Jaitley said: “I am sorry you are comparing apples and oranges. 

The Government had first declared a Voluntary Income Disclosure Scheme (VDIS) in 1951 wherein evaders could intimate the income tax officer and pay tax with immunity from penalty or prosecution. The scheme saw a disclosure of Rs 70 crore and tax worth Rs 11 crore. Similar schemes were launched in 1965, 1975 and 1997. Except for the VDIS scheme of 1997, which was announced by the then finance minister P Chidambaram and saw a declaration of over Rs 33,000 crore, all other schemes fizzled out due to high rate of penalties and the fear of prosecution despite assurances from the Government.