Two lakh under lens for Rs 20L deposits after note ban

NEW DELHI: The government has served tax notices on nearly 2 lakh people who had deposited over Rs 20 lakh in scrapped Rs 500 and Rs 1,000 notes during the demonetisation drive but have neither responded to the tax department's request for information, or have failed to file returns. "We have given them a lot of time and we waited for them to come clean in the annual returns but they have ignored our repeated pleas leaving us with no option but to serve notice on them to file returns," a senior income tax officer told TOI.

Chasing errant taxpayers prosecuting, who have not fallen in line, has been identified as a key priority by the income tax department this year. In addition, the Central Board of Direct Taxes is pursuing recovery action across the country to ensure that the evaders do not roam around without any fear. Sources said that CBDT chairman Sushil Chandra has repeatedly prodded his officers to go after the evaders as the government has repeatedly said that the honest need to be rewarded.

After mining data, the government had identified 18 lakh suspicious deposits of Rs 5 lakh or more during the 2016 demonetisation drive, of which 12 lakh had been verified through the income tax portal.


The amount of suspect deposits is estimated to be around Rs 2.9 lakh crore, which is less than a fifth of the notes that were deposited. In all over five lakh have not responded to responded to the department's request for verification prompting the government to first go after the big fish, starting with the 70,000-odd who had deposited Rs 50 lakh or more in scrapped Rs 500 and Rs 1,000 notes. As reported first by TOI on November 6, in subsequent rounds the government had planned to after smaller unverified deposits.

While the Modi administration has been criticised for demonetisation, especially because over 99% of the scrapped notes came back into the system, it has maintained that the exercise has provided it with enormous data and over the next year or two it will go after those who have misused the scheme.