Those under watch ineligible for IDS

Vivek Mehra, partner, tax and regulatory services at PwC India, agreed with Mr. Raj’s assessment of the scheme.

“This could be a dampener for the scheme as it would exclude potential disclosures from people who received notices seeking a regular explanation on the returns they had filed,” he said.

Union Finance Minister Arun Jaitley has proposed a “limited-period Compliance Window for domestic taxpayers to declare undisclosed income or income represented in the form of any asset and clear up their past tax transgressions” by paying tax at 30 per cent, and Krishi Kalyan surcharge at 7.5 per cent and penalty at 7.5 per cent — a total of 45 per cent of the undisclosed income. Undisclosed income of any financial year up to 2015-16 can be brought overground through this window.

Under the income declaration scheme, people who have received notices under Sections 142 (1), 143 (2), 148, 153A or 153C of the Income Tax Act are not eligible to disclose previously concealed income.

Separately, as per the explanatory memorandum to the budget, it won’t be open to cases “where a search or survey has been conducted and the time for issuance of notice under the relevant provisions of the Act has not expired, or where information is received under an agreement with foreign countries regarding such income, cases covered under the Black Money Act, 2015, or persons notified under Special Court Act, 1992, or cases covered under Indian Penal Code, the Narcotic Drugs and Psychotropic Substances Act, 1985, the Unlawful Activities (Prevention) Act, 1967, and the Prevention of Corruption Act, 1988.”

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