Accept IDS payments till September 2017; don’t ask source: IBA to banks
The four-month IDS was a one-time window, beginning June, given to black money holders to declare their stash and come clean by paying 45% tax and penalty
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New Delhi: With the last date for paying the first instalment of due taxes and penalty under the one-time black-money window IDS nearing, banks have been asked to ensure that such payments are accepted without any hassle and the source of funds is not sought from the declarant. The Indian Banks’ Association (IBA) has written a letter to all its members in which it referred to a recent Central Board of Direct Taxes (CBDT) communication to Reserve Bank of India (RBI) which cited a complaint from a declarant that he/she could not deposit the payment as a bank branch in Bengaluru allegedly refused to accept the tax and penalty as per plan of the Income (IDS) that ended on 30 September .
CBDT, which is the income tax (I-T) department’s policy-making body, noted that the scheme stipulates that a minimum amount of 25% of the tax, surcharge and penalty is to be paid by 30 November 2016. “Accordingly, all the member banks are requested to make note of the...time schedule and as directed accept payments under IDS, 2016 up to 30 September 2017 and also for such cases the banks should not seek source of funds,” it said adding, “we request you to sensitise your branches accordingly.”
It added that the recent communication from the Central Board of Direct Taxes to the RBI, subsequently sent to the IBA for action, had said that it “has been alleged that the bank authorities are refusing to accept payment stating that since IDS, 2016 has closed on September 30, the banks cannot accept the challan beyond the date”.
The CBDT has also appended the scheme of the IDS which stipulates that a minimum amount of 25% of the tax, surcharge and penalty is to be paid by 30 November 2016; a further amount of 25% of the tax, surcharge and penalty to be paid by 31 March next year; and the balance amount to be paid on or before 30 September 2017.
The I-T department only on Saturday issued advertisements in this regard in leading national dailies stating that non-payment of the first instalment of tax and penalty by 30 November on the part of declarants will render their declaration under IDS as “invalid”. As per official data, 64,275 declarants had disclosed an amount of Rs65,250 crore under IDS which would yield about Rs30,000 crore in taxes to the government. The four-month IDS was a one-time window, beginning June, given to black money holders to declare their stash and come clean by paying 45% tax and penalty.