Indian rupee tax evasion
Indian rupee tax evasionReuters file

A week ago, the Narendra Modi government said that the income tax department had identified over 14 lakh high-value transactions, in which taxpayers had not quoted their permanent account number (PAN), giving rise to suspicion of tax evasion. Taking the next step, the income tax department decided to send seven lakh letters seeking information from concerned individuals and entities on such high-value, non-PAN transactions.

In Bengaluru (Bangalore) alone, the income tax department has issued letters to over 7,400 taxpayers, seeking information. 

"In the Karnataka and Goa circles, Bengaluru tops the list as it generates high volume of revenue. Details of fixed deposits upwards of Rs two crore that were not declared to the department were collected and letters with specific information about the evasion have been sent," Nupur Wodeyar, principal chief commissioner of Income Tax, Karnataka and Goa circle, told Bangalore Mirror.

Overall, about 11,000 letters were sent to such taxpayers by the Bengaluru income tax office.

The move to issue letters follows tracking of such transactions over a long period.

"The department has details of about 90 lakh such transactions for the period 2009-10 to 2016-17. The Income Tax department has with the help of in-house computer techniques, grouped such non-PAN transactions and identified 7 lakh high-risk clusters having around 14 lakh non-PAN transactions which are being scrutinized by the Income Tax Department closely," the finance ministry said in a statement on July 21.

The government's crackdown on tax evaders is in line with its efforts to curb generation of black money by giving them an opportunity to come clean before Sept. 30 under the Income Declaration Scheme (IDS), 2016.

"The Income Declaration Scheme, 2016' (the scheme) has been introduced vide the Finance Act 2016, with effect from 1st June 2016. The scheme provides for an opportunity to all the persons who have not paid full taxes in the past to come forward and declare the undisclosed income and pay tax, surcharge and penalty, totalling to forty-five per cent of such undisclosed income declared. The scheme is open for declarations up-to 30th September 2016," Arun Jaitley, finance minister, informed the Lok Sabha last Friday.

He also said that searches at over 900 groups of assessees over two financial years 2014-15 and 2015-16 resulted in seizure of undisclosed assets worth Rs. 1,474 crore and unearthing of undisclosed income of Rs.21,354 crore.