Compliance window for domestic black money opens June 1

New DelhiL The 4month disclosure window giving an opportunity to domestic black money holders to come clean by paying tax and penalty of 45 per cent on such assets will open tomorrow People who have made money through corrupt means will not be allowed to take advantage of the disclosure windowUnder the Income Declaration Scheme persons making disclosure of unaccounted assets will be given time up to November 30 to pay taxes penalty and surcharge totalling 45 per cent at the fair market valueThe Finance Ministry officials have also held an online talkathon to create awareness about the disclosure window Earlier in the month CBDT came out with a 14Frequently Asked Questions FAQs and a circular to explain the provisions of the income disclosure windowIt was clarified that the declaration made under the scheme will not be used against the declarants under the IncomeTax Act or Wealth Tax now abolished There will also be an immunity from Benami Transactions Prohibition ActFinance Minister Arun Jaitley had said on Monday that people with undisclosed assets should use the limited period income declaration window beginning tomorrow if they want to sleep wellStarting from day after tomorrow the new window opens and I will advise all those who have any undisclosed asset to declare it and pay the tax and sleep well Otherwise the way the disclosures are becoming more and more public they will run into serious trouble Jaitley had saidThe declarants will be liable for capital gains tax on sale of such assets in future The scheme however will not apply in relation to prosecution of any offense punishable under the Prevention of Corruption Act 1988Therefore declaration of such undisclosed income cannot be made under the scheme the FAQs said adding that such declaration will amount to misrepresentation of facts and hence voidOn a question whether a person can declare undisclosed income which has been acquired from money earned through corruption the CBDT in its FAQ said NoIf a declaration is held as void the provisions of the Incometax Act will apply in respect of such income as they apply in relation to any other undisclosed incomeThe scheme for domestic black money holders follows a similar one for those having undisclosed foreign assets Individuals HUF company firm and any association can take advantage of the income declaration scheme announced in the Union Budget to fish out black money from the domestic economyAs per the CBDT circular if the declarant fails to pay the entire amount of tax surcharge and penalty within the specified date November 2016 the declaration will become voidWhere the declaration is held to be void for any of the above reasons it shall be deemed never to have been made and all the provisions of the Incometax Act including penalties and prosecutions shall apply accordingly it said It was further observed that the scheme will not be available for undisclosed income which has been assessed to tax and the case is pending before an Appellate AuthorityThe amount of undisclosed income declared will not be included in the total income of the declarant for any assessment year