Income Tax dept raises rewards for informers of benami property, tax evasions
In its fight against black money, the Income Tax department has unveiled a scheme under which people who inform it of benami properties and tax evasions can earn rewards up to Rs 5 croreore, including substantial sums in immediate payments.
The Union finance ministry has for the first time come out with a scheme to reward informants of benami transactions and has also amended the existing income tax informant reward scheme of 2007.
Under the scheme finalised on April 23, any person who provides credible information to Income Tax authorities about benami property can earn instant reward which will be 1% of the market value of the property subject to a maximum cap of Rs 10 lakh.
“Pursuant to the information, if the I-T department can provisionally attach the property, the informant will immediately get the said amount,” said a senior I-T official who was involved in the framing of the scheme.
The final amount, which the informant will get two years after the confiscation of the property provided there is no litigation, will be 5% of the total cost with the maximum cap of Rs 1 crore.
The finance ministry also introduced a reward scheme for any undisclosed foreign income and assets.
“We have recommended the highest award for this category of informant because it is very difficult to get information about people who have properties abroad or stashed away their money in foreign destinations,” said the officer.
For this type of information, the maximum instant reward is Rs 50 lakh “when the competent authority is satisfied that assessment made is likely to be sustained in appeal and taxes levied are likely to be recovered.”
On final settlement, the informant can get 10% of the additional tax levied with a cap of Rs 5 crore.
As far as providing information regarding undisclosed income/assets in the country is concerned, the amended scheme recommends maximum instant reward of Rs 10 lakh with Rs 50 lakh being the final reward after the final assessment.
The maximum instant award money in the previous scheme was Rs 1 lakh and final reward was Rs 15 lakh.
Last month, HT had reported that government was planning to substantially enhance the rewards for informants as senior officials were of the view in a majority of the cases, where defaulters seek legal recourse, informants have to wait for years for their rewards.
“So it was very important to incroreease the instant reward money along with the reward after the final settlement of the case,” said a senior I-T official.
He cited a case in which an informant has been waiting for over two decades to get his due. The amended scheme also comes with a new provision in which if an informant provides specific information of unaccounted/undisclosed cash exceeding Rs 1 crore, the immediate reward will be Rs 15 lakh.
“This sounds like a good scheme. However, the department should ensure that the antecedents of the informers are scroreutinsed for genuineness so that unscroreupulous people don’t try to abuse the same to settle scores with business or personal rivals etc,” said said SK Goyal, former chief commissioner of the Income Tax department.