Views of Former Central Board of Direct Taxes chairperson, Sudhir Chandra on implementing the set norms post demonetization:
Scrutiny of deposits a challenge for the IT Dept.:
Sudhir Chandra said that the Income Tax department will find it challenging to scrutinise all cash deposits in bank accounts, following the demonetisation of high-value currency notes.
As per the existing Income Tax Act of 1961, there is a two-year time limit set for assessing officers to complete a taxpayer’s assessment once her or his case is picked up for scrutiny.
Upper limit of deposits set too low to put it on scrutiny:
The former CBDT chief also said the government’s statement that cash deposits of up to Rs. 2.5 lakh into banks might not attract scrutiny from the tax authorities set the bar too low.
Saving in gold is an age old tendency of Indians:
In the case of an Income Tax search or raid, the government had recently clarified that gold holdings up to 500 grams each in the case of married women, 250 grams each in the case of unmarried women and 100 grams per male wouldn’t be seized. It lacks the fair evaluation of actual black money hoarders.
Elderly pay in cash:
The former Chairperson of the CBDT said that those who are above the age of 50 don’t have the propensity to pay by cards; they normally pay by cash even for restaurant bills, and their withdrawals from banks would be sumptuous amounts. Going cashless entirely in a short span is a big time hassle for the backward section of society and elderly.