The Indian Banks Association recently directed the banks to accept Rs. 500 and Rs. 1000 notes for the payment of tax, penalty and interest payments in connection with the IDS scheme. The last date for paying the first installment of due taxes and penalty under the one-time black money window IDS is 30th November.
“Accordingly, all the member banks are requested to make note of the…time schedule and as directed accept payments under IDS, 2016 up to September 30, 2017 and also for such cases the banks should not seek source of funds,” it said adding, “we request you to sensitise your branches accordingly.”
It added that the recent communication from the Central Board of Direct Taxes to the RBI, subsequently sent to the IBA for action, had said that it “has been alleged that the bank authorities are refusing to accept payment stating that since IDS, 2016 has closed on September 30, the banks cannot accept the challan beyond the date”.
The CBDT has also appended the scheme of the IDS which stipulates that a minimum amount of 25 per cent of the tax, surcharge and penalty is to be paid by March, 31 next year; and the balance amount to be paid on or before September 30, 2017.
In connection with this, the IT Department has issued advertisements stating that non-payment of the first installment of tax and penalty by November 30 on the part of declarants will render their declaration under IDS as “invalid”.
IDS was a one-time opportunity granted to all black money holders to declare their stash and come clean by paying 45% tax and penalty without declaring the source of income. As per official data, 64,275 declarants had disclosed an amount of Rs 65,250 crore under IDS which would yield about Rs 30,000 crore in taxes to the government.
