Several business entities, including dealers of luxury brands such as Harley-Davidson and Louis Vuitton, are under the Income Tax (IT) scanner for accepting cash for transactions above Rs 2 lakh.
The cash transaction is in violation of a new income tax law introduced in this year's budget, aimed at putting a check on black money and tax evasion. Section 269ST of the Income Tax Act was introduced under the Finance Act, 2017 and provides for a penalty for any cash transaction above the value of Rs. 2 lakh equal to the transaction amount.
The businesses in trouble include a Harley-Davidson showroom in Guwahati, Venkys in Pune, Gucci and Louis Vuitton dealers and 5-star hospitals in Mumbai, Delhi, Chennai, Lucknow, and Indore. The Directorate of Intelligence and Criminal Investigation, Department of Income Tax, had run a special project between January and March to nail these companies.
An officer involved in the operation told ANI that a total of 1,705 cases were found to be violating Section 269ST of the Income Tax Act. The violators will be levied a penalty of Rs.45.60 crore under Section 271DA.
As per Section 271DA of the Income Tax Act, if a person receives any sum in contravention of any of the provisions and rules of Section 269ST, he shall be liable to pay a penalty of the amount equal to the amount of such receipt received in cash.
According to the officer, the survey found that violators had changed their accounting software.
The case has now been forwarded to an assessing officer that they had started working on this case.
In some cases, notices were sent and some searches had also been done. A Central Board of Direct Taxes (CBDT) official said on condition of anonymity that recently they had conducted searches on some fashion designers who had taken cash above Rs. 2 lakh.
[With inputs from ANI]
