Hundreds of bullion traders, property dealers, civil contractors, shell companies, petrol pump owners and cooperative societies moved thousands of crores into multiple bank accounts during November 8, 2016 to December 30, 2016 to obscure the trail of slush funds
Nearly 18 lakh companies and individuals are under the government’s scanner for depositing unaccounted cash soon after Prime Minister Narendra Modi announced “demonetisation”, banning Rs 500 and Rs 1000 notes from November 8, 2016.
These individuals and companies had disclosed income in their tax returns far lower than the cash deposits during 50 days ending December 30, 2016 that the government had given to people to deposit the outlawed notes.
Hundreds of bullion traders, property dealers, civil contractors, shell companies, petrol pump owners and cooperative societies moved thousands of crores into multiple bank accounts during November 8, 2016 to December 30, 2016 to obscure the trail of slush funds.
Moneycontrol has exclusive details from the I-T Department’s status report on “Operation Clean Money” collated in May 2017 based on cash deposits made in banks during the demonetisation drive.
“The cash deposit data was analysed to identify persons whose cash transactions did not appear in line with their tax paying profile. This analysis resulted in identification of about 17.92 lakh persons for verification process,” a source, who did not wish to be identified, said.
Under Operation Clean Money, which the government launched on January 31, 2017, tax payers, whose cash deposits were found to be significantly greater than their disclosed incomes, were given an option to explain the inconsistency in an online portal.
Till May 12, 2017, of the 17.92 lakh people identified for verification, more than 9.72 lakh taxpayers have given their responses through the online portal. This involves 13.33 lakh accounts involving cash deposits of around Rs 2.89 lakh crore.
More than half of these deposits (57 percent) were claimed to have been from currency notes collected through cash sales. A fifth (20 percent) were disclosed as cash out of earlier or savings, while 9.6 percent of these deposits were shown to be “other cash receipt”.
Another 4.2 percent were disclosed as cash out of receipts exempt from tax, and 4.1 percent of such deposits were shown as cash withdrawn out of bank accounts. Loan repayments in cash accounted for 2.9 percent of these deposits, with “others” accounting for 1.7 percent.
According to the report, the data mined during the 50-day demonetisation drive showed “large scale conversion of unaccounted cash”, using back dating of sales, splitting of sale bills to avoid PAN reporting norms, providing entries through bogus sales, layering transactions to hide the identity of the ultimate beneficiary, acceptance of advances in cash against future sales and other methods.In many instances, jewellers were found to have deleted CCTV footage to destroy evidence of customers visiting stores on the night of November 8, 2016.