Consequent to the move of banning old ₹500 and ₹1000 notes, the Income Tax department has detected over Rs 200 crore in undisclosed income after it conducted over 80 surveys and about 30 searches in cases of suspicious usage of the scrapped currency. About Rs 50 crore has also been seized in these operations since November 8, they said, across various states.

As a part of this initiative, department has been keeping a watch on bank accounts where huge cash deposits have been made post November 8. If found suspicious, such accounts would be investigated. If found guilty, such persons would be prosecuted under the Benami Property Transactions Act, 1988, applicable on both movable and immovable property, that has been enforced from November 1 this year.

Such an arrangement where a person deposits old currency of Rs 500 and Rs 1000 in the bank account of another person with an understanding that the account holder shall return his money in new currency, the transaction shall be regarded as benami transaction under the said Act.

The person who deposits old currency in the bank account shall be treated as beneficial owner and the person in whose bank account the old currency has been deposited shall be categorised under this law as a benamidar.

The Benami Act, the official said, provides that the benamidar, the beneficial owner and any other person who abets or induces the Benami transaction, shall be punishable with rigorous imprisonment for a period ranging from 1-7 years.

“The benami amount in the bank account deposited post de-monetisation will be seized and confiscated and the accused will also be liable to fine which extends upto 25 per cent of the fair market value of the benami property,” the official said.

 (Source: Economic Times)