Lok Sabha Question No. 114 (UNSTARRED), answered on 2020-02-03
Subject: Black Money
Ministry: FINANCE
Asked by: Prathap Simha, Deepak (Dev) Adhikari

## GOVERNMENT OF INDIA MINISTRY OF FINANCE DEPARTMENT OF REVENUE

## LOK SABHA UNSTARRED QUESTION NO. 114 TO BE ANSWERED ON MONDAY, 03 RD  FEBRUARY, 2020

MAGHA 14, 1941(SAKA)

## BLACK MONEY

114: SHRI PRATHAP SIMHA: SHRI ADHIKARI DEEPAK (DEV):

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

- (a) whether the Government has made an assessment of black money stashed abroad and its circulation within the country;
- (b) if so, the details thereof and if not, the reasons therefor along with the reaction of the Government thereto;
- (c) whether the figures of black money have changed after demonetisation and if so, the details thereof;
- (d)  whether  the  Government  has  reviewed  the  existing  machinery  in  tracing/  recovering black money particularly stashed abroad during the last three years and the current year and if so, the details thereof;
- (e) the quantum of black money recovered so far within the country and stashed abroad; and
- (f) the corrective steps taken by the Government in this regard?

## ANSWER MINISTER OF STATE FOR FINANCE (SHRI ANURAG SINGH THAKUR)

(a) & (b):  There is no official estimation regarding the amount of black money within the country and stashed abroad. However, the Government had commissioned a study, inter alia , on  estimation  of  unaccounted  income  and  wealth  inside  and  outside  the  country,  through National  Institute  of  Public  Finance  and  Policy  (NIPFP),  National  Council  of  Applied Economic Research (NCAER) and National Institute of Financial Management (NIFM).  The reports  and  a  detailed  Government's  response  on  them  were  forwarded  to  the  Lok  Sabha Secretariat  for  placing  them  before  the  Standing  Committee  on  Finance.  The  Standing Committee on Finance, after due deliberations and taking necessary oral evidences, presented a  preliminary report  on  the  matter  (i.e.  73 rd Report  of  Standing  Committee on Finance) to Hon'ble Speaker of Lok Sabha on 28.03.2019.

- (c): Post demonetisation, during November 2016 to March 2017, searches were conducted in 900 groups leading to seizure of Rs. 900 crores, including cash of Rs. 636 crores and admission of  undisclosed  income  of  Rs.7961  crores.  During  the  same  period,  8239  surveys  were conducted leading to detection of undisclosed income of Rs.6745 crores.

Notices were issued and sms and emails were sent to persons who had deposited substantial amount of cash but had not filed their return of income till the due date of filing . As a result, Returns were filed by 2.09 lakh such identified non-filers and they paid self-assessment tax of Rs. 6,531 Crore.

Electronic  Campaign  was  also  executed  for  Non-filers  with  potential  tax  liabilities  for Assessment Years 2016-17 and 2017-18. A total Self-Assessment Tax of more than Rs 13000 crores was paid by targeted non-filers.

Net direct tax collections for 2017-18 amounted to Rs. 10.03 lakh crore, which is 18% higher than the collections for 2016-17. The collections for 2016-17 were also 14.6% higher than the collections for 2015-16. On the other hand, the growth rates in 2015-16 and 2014-15 were only 6.6%  and  9.0%,  respectively.  The  robust  growth  in  direct  tax  revenue  in  the  year  of demonetisation and the year after that is indicative of a positive impact of demonetisation on the level of tax compliance in the country.

(d) and (e): The Government is committed towards its fight against black money, including black money stashed abroad and has taken various actions in this regard. Further, periodic review of the Government's machinery to make it more effective in fight against black money is an on-going process.

Appropriate  actions  against  evasion  of  taxes/black  money  under  direct  tax  laws  includes searches, surveys, enquiries, assessment of income, levy of taxes, penalties, etc. and filing of prosecution complaints in criminal courts, wherever applicable.

The value of assets seized by the Income Tax Department in the search and seizure actions during the last three F.Ys. is as under:

|   S.No. | F.Y.     |   Value of assets seized (in Rs. crore) |
|---------|----------|-----------------------------------------|
|       1 | 2016-17  |                                 1469.62 |
|       2 | 2017-18  |                                  992.52 |
|       3 | 2018-19* |                                 1584.11 |

* figures are provisional

The  Income  Tax  Department  has  taken  continuous  and  concerted  actions  under  the  Black Money (Undisclosed Foreign Income & Assets) and Imposition of Tax Act, 2015 since this Act came into force from 1 st July, 2015. As a result, as on 31.12.2019, notices have been issued in 422 cases under this Act, involving undisclosed foreign assets and income of over Rs. 12,600 crores.

The details of action taken by the Income Tax Department on some of the significant categories of foreign assets/ income cases, are as under:

(i) On account of deposits made in unreported foreign bank accounts in HSBC cases, so far, undisclosed income of more than Rs. 8460 crores have been brought to tax and penalty of more than Rs. 1290 crores levied.

- (ii) Sustained investigations conducted in the cases revealed by International Consortium of Investigative Journalists (ICIJ) have led to detection of more than Rs. 11,010 crore of credits in the undisclosed foreign accounts so far.
- (iii) In the Panama Paper Leaks investigations, undisclosed foreign investments amounting to over Rs. 1500 crores have been detected.
- (f):   The Government has taken several steps in its fight against black money. Some of these steps taken in recent years include:
- (i) Enactment  of  'The  Black  Money  (Undisclosed  Foreign  Income  and  Assets)  and Imposition of Tax Act, 2015' which has come into force w.e.f. 01.07.2015 to specifically and more effectively deal with the issue of black money stashed away abroad.
- (ii) Enactment  of  the  Benami  Transactions  (Prohibition)  Amendment  Act,  2016  to comprehensively amend the Benami Transactions (Prohibition) Act, 1988 with a view to, inter alia, enable confiscation of benami property and prosecution of benamidar and the beneficial owner.
- (iii) The Government has brought in a large number of legislative provisions in the Income Tax Act, 1961 to effectively tackle the menace of black money.
- (iv) Effective enforcement actions and expeditious investigation in relevant cases.
- (v) Extensive use of information technology and data analytics tools for identification of high-risk  cases,  expeditious  e-verification  of  suspect  cases  and  consequential  enforcement actions in appropriate cases.
- (vi) Mandatory linking of Aadhaar with PAN, which will not only help in de-duplication of PAN but will also prevent potential tax frauds and money- laundering.
- (vii) India has proactively engaged with foreign governments with a view to facilitate and enhance  the  exchange  of  information  under  Double  Taxation  Avoidance  Agreements (DTAAs)/Tax Information Exchange Agreements (TIEAs)/Multilateral Conventions.
- (viii) India has been a leading force in the efforts to forge a multi-lateral regime for proactive sharing  of  financial  information  known  as  Automatic  Exchange  of  Information  which  will greatly assist the global efforts to combat tax evasion. The Automatic Exchange of Information based on Common Reporting Standard has commenced from 2017 enabling India to receive financial account information of Indian residents in other countries.
- (ix) India has entered into information sharing agreement with the USA under the Foreign Account Tax Compliance Act of USA. The exchanges under Foreign Account Tax Compliance Act have taken place for the financial years 2014, 2015, 2016, 2017 and 2018.

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