Lok Sabha Question No. 4982 (UNSTARRED), answered on 2017-03-31
Subject: Malpractices by Petrol Pump Owners
Ministry: FINANCE
Asked by: SAUGATA ROY

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE LOK SABHA

## UNSTARRED QUESTION NO. 4982

TO BE ANSWERED ON FRIDAY, THE 31 ST  MARCH, 2017

CHAITRA 10, 1939 (SAKA)

## MALPRACTICES BY PETROL PUMP OWNERS

4982. PROF. SAUGATA ROY:

## Will the Minister of FINANCE be pleased to state:

- (a) whether the Government has noticed the malpractices done by owners of petrol pump, CNG and gas agencies on  the  transactions  of  the  currencies  of  Rs.1000  and  500  after demonetization;
- (b) if so, the details thereof;
- (c)  whether  the  Government  has  scrutinised  their  deposits  and  sales  of  that  particular period; and

(d) if so, the details thereof and the action taken thereon?

## ANSWER MINISTER OF STATE FOR FINANCE (SHRI SANTOSH KUMAR GANGWAR)

(a) & (b) : Investigations conducted by the Income Tax Department (ITD) post demonetisation have  revealed  various  kinds  of  malpractices  and  manipulations  by  certain  persons/entities including owners of petrol pump, CNG and gas agencies.  Appropriate action against such persons is taken by the jurisdictional authorities of the ITD as per provisions of the Incometax Act, 1961. In case of violation of other laws, information is also shared with authorities concerned.

Disclosure  of  information  in  respect  of  specific  entities,  however,  is  prohibited  except  as provided under section 138 of the Income-tax Act, 1961.

- (c) & (d): While deposits and sales of all petrol pumps, CNG and gas agencies have not been scrutinised;  however,  in  certain  cases  of  petrol  pumps/LPG  distributorships/CNG  Pumps, excess cash deposits over and above the sales made in the corresponding period have been found during the enforcement actions by the ITD.

During the period 9 th  November 2016 to 10 th  January 2017, more than 1100 search and survey were  conducted  by  the  Income  Tax  Department,  apart  from  issuing  more  than  5100 verification notices in the cases of suspicious high value cash deposits or related activities. These actions led to seizure of valuables of more than Rs. 610 crore which includes cash of Rs. 513 crore. Seizure of cash in new currency notes was about Rs 110 crore. Further, the undisclosed income detected in these actions was more than Rs. 5400 crore.  Further,  ITD has initiated 'Operation Clean Money' (OCM) on 31 st  January 2017 to leverage technology and data analytics for e-verification of cash deposits made during the demonetization period i.e. 9 th November   to  30 th December  2016  to    reduce  compliance  cost  for    the  taxpayers  and optimise Government  resources.   Under

OCM, about 18 lakh persons have been identified whose tax profiles were prima facie not in line with the cash deposits made by them during the demonetization period. As part of the initial phase, the ITD has sought online response as per pre-defined parameters on source(s) of cash deposited by such persons through its e-filing portal.

More than 12 lakh responses have been received from 8.38 lakh distinct PANs/persons. In case explanation of source of cash is found justified, the verification is closed. The verification is  also  closed  if  the  cash  deposit  is  declared  under  Pradhan  Mantri  Garib  Kalyan  Yojna (PMGKY). Enforcement  actions  such  as  searches  and  surveys  are  also  conducted  in appropriate cases including those who are non-compliant.

Action in such cases is part of continuous process under the Direct Taxes law. Such actions include  assessment  of  income,  levy  of  taxes,  penalties,  etc.  and  filing  of  prosecution complaints in criminal courts, wherever applicable.

*******