Supreme Court has made it mandatory that Income Tax returns will be filed with Aadhaar and the last date for linking PAN with Aadhaar is March 31.
Just 23 crore PAN card holders — over half of the total PAN card holders — have so far linked their cards with biometric ID Aadhaar, even as the deadline to link the two comes to an end on March 31, 2019. Central Board of Direct Taxes (CBDT) Chairman Sushil Chandra said the Income Tax department has so far issued 42 crore permanent account numbers (PAN), of which 23 crore have been linked with Aadhaar. Supreme Court has made it mandatory that Income Tax returns will be filed with Aadhaar and the last date for linking PAN with Aadhaar is March 31.
“By linking with Aadhaar, We will know whether there are any duplicate PAN or not. And there are certain duplicate PANs… If it is not linked, we may cancel the PAN also,” Chandra said while addressing an Assocham event. The Supreme Court in September last year had declared the Centre’s flagship Aadhaar scheme as constitutionally valid. A five-judge constitution bench had held that while Aadhaar would remain mandatory for filing of I-T returns and allotment of PAN, it would not be mandatory to link Aadhaar to bank accounts and telecom service providers cannot seek its linking for mobile connections.
Chandra said, once Aadhaar is linked with PAN and PAN is linked with bank account, the I-T department can find out spending pattern and other details of the assessee. Also since many agencies are linked with Aadhaar, it would be easier to gauge whether the benefits of welfare schemes are availed by eligible persons.
Section 139 AA (2) of the Income Tax Act says that every person having PAN as on July 1, 2017, and eligible to obtain Aadhaar, must intimate his Aadhaar number to the tax authorities. Chandra said, so far this year 6.31 crore returns have been filed, which is much more than 5.44 crore persons who had filed last year. So far 95 lakh new taxpayers have been added by department.
“It is not absolutely true that if we reduce tax rates, compliance goes up. During this year we have followed the policy of finding the non-filers… We have got third party information and we are checking whether persons are filing returns or not, whether adequate income being shown,” he said. Under the Non-filers monitoring system (NMS) individuals who have carried out high value transactions but have not filed their income tax returns are sent intimation by the I-T department giving them 21 days time to submit their responses.
“From last month again we have rolled out NMS and in 15 days 33,000 more taxpayers have been added. A person has made foreign remittance of Rs 10 lakh but you have not filed returns, purchased property of Rs 30 lakh but not filed return. We are showing them the mirror and information, and asking what do you have to say about it,” Chandra said. He said in the last 15 days, more than 3 lakh persons visited their e-filing website and of that 33,000 have already filed returns.
He regretted that in a country with 125 crore population and an economic growth rate of 7.5 per cent only 1.5 lakh returns are being filed showing income of over Rs 1 crore. “It is a very sorry state of affair that in this country when he say that GDP, expenditure, consumption is growing, all 5 star hotels are full, but if you ask somebody how many persons are filing returns more than Rs 1 crore? It is really pathetic,” Chandra said. This year so far 1.5 lakh persons have filed returns of income above Rs 1 crore, higher than 88,000 filed in 2013-14.
Chandra said that the I-T department is getting information about foreign assets held by persons but have not disclosed them in their income tax returns. “Today I have information about so many person which have come under CRS (Common Reporting Standard). I was really surprised that so many persons are there who have a foreign asset and not disclosing in ITRs. By not declaring your asset in FA schedule you are making yourself prone for prosecution,” he said.
Under the black money act, non disclosure of foreign asset, even if it is from an explained source of income, would attract 3-year prosecution. If the asset is from an income for which source cannot be explained, then prosecution would be for 7 years. “It should be our endeavour that honest taxpayers will have to be cared by the department but tax evaders should be dealt strictly,” he said.