CBDT’s Operation Clean Money Reins in the Black Economy

CBDT’s Operation Clean Money Reins in the Black Economy. The Earnings Tax Department (ITD) released “Operation Clean Money” (OCM) on 31 st January 2017 to utilize technology for e-verification of cash deposits made throughout the demonetization duration i.e. 9th November to 30 th December2016 It is a distinct operation being conducted by the Income-tax Department (ITD) through usage of advanced information analytics permitting optimization of federal government resources and causing minimum trouble to the taxpayers.

The first stage of the operation involved e-verification of money deposits made in the banks. The whole stage was performed online, where 17.92 lakh individuals, who entered into cash transactions that did not appear to be in line with their tax profile, were recognized and requested for online reactions on such transactions. 9.46 Lakh individuals responded on per pre-defined parameters of sources of the cash deposits. Online inquiries were raised in 35000 cases and on-line verification was completed in more than 7800 cases. It has been decided to close the verification in cases where explanation of source of cash was found to be justified. In cases where the cash deposit has been stated under Pradhan Mantri Garib Kalyan Yojna (PMGKY), the confirmations would also be closed

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The operation has moved into the next phase with identification of high threat individuals for in-depth investigations by the ITD. The identification has been done through usage of innovative data analytics, consisting of combination of data sources, relationship clustering and fund tracking. The high danger categories determined include companies claiming money sales as the source of cash deposits which is found to be extreme compared to their past profile or industry standards; big cash deposits made by federal government or PSU employees; persons who have actually carried out high worth purchases; individuals who have actually utilized shell entities for layering of funds; and where no reactions were gotten.

More than 60,000 individuals, including 1300 high danger persons, have actually been determined for examination into claims of extreme money sales throughout the demonetisation period. More than 6000 deals of high value property purchase and 6600 cases of outside remittances will undergo comprehensive investigations. All the cases where no response is gotten will also be subjected to in-depth queries

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Federal government has actually currently taken extensive enforcement action consisting of search and seizure and surveys largely based on the details received during the demonetisation period.818 crore, which consist of money of Rs.

The effect of Government action is currently visible in the boost of 21.7 % in the returns of Income received in FY 2016-17; 16% growth in Gross Collection, the highest in the last five years; 14% Development in Net Collection– the highest in last three years and above 18%, 25% and 22% development in Personal Earnings Tax, Regular Assessment Tax and Self-assessment Tax respectively.

One of the mentioned objectives of demonetisation was ‘removal of Black Cash that casts a long shadow of parallel economy on our real economy’. The opportunities produced by demonetization is being utilized by the ITD for expanding and deepening of the tax base and produce deterrence, not seen before, and to curb generation of black money in the Indian economy.

Source: Income Tax India

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