Source of income to be probed after Dec 30
SHILLONG: Though it is unbelievable, there is no information about black money holders in Meghalaya as neither the State Bank of India nor the Income Tax department here has detected any transactions which are alarming, since the night of November 8 following the demonetisation announcement of Prime Minister Narendra Modi.
The senior officials of SBI and Income Tax department revealed on Friday that they had not received any reports related to exchange of cash and deposits beyond the permissible and taxable limit.
However, they said that still there is time till December 30 to exchange the old Rs 500 and Rs 1,000 currency notes by those who still hold on to them fearing action.
“Our role comes into picture only after December 30 when the exchange of old Rs 500 and Rs 1,000 currency notes with the banks will come to an end,” a senior Income Tax official said on Friday.
However, a top SBI bank official admitted that traditionally, the people of Meghalaya have a tendency to keep the cash in their homes instead of depositing them in the banks.
“There is no problem in keeping cash at home, but if there are any queries from the bank, this traditional practice can be explained and what is important is to reveal the source of income,” the official added.
Though the tribals in the Sixth Schedule areas are exempted from paying income tax under Section 10 (26) of the Income Tax Act, 1921, individuals depositing cash over Rs 2.5 lakh will have to be ready to explain the source of their income in the current situation and the punishment for not disclosing the income is 200 per cent on the payable tax.
Moreover, the banks in the State are yet to come across anyone depositing fake Indian currency notes as the officials associated with various banks believe that the restriction on the use of Rs 500 and Rs 1,000 notes has deterred those who have fake currencies from coming forward.
The officials also said that the restriction will help control black money as those with undisclosed income in currencies of Rs 500 and Rs 1,000 have only two options now, either to deposit them in banks for exchange or destroy them.
While the officials of banks and Income Tax office here hailed the decision of the Prime Minister, they have no answers what would be the situation beyond December 30 since there is no effective mechanism to control the duplication of the new Rs 500 and Rs 2,000 notes.
Moreover, people can still stock the new currencies in their homes.