Skip to main content

I-T dept seeks data of property deals worth Rs 1 cr or more in last 10 yrs


The income tax (I-T) department has asked all sub-registrars and tehsildars under its jurisdiction in Mumbai to send it details of property deals worth Rs 1 crore or more in the past 10 years. This is aimed at nabbing those who stash unaccounted money in benami property.
The letters from the I-T department, seeking information of property registrations between April 2007 and June 2017, were issued under Section 21(1) of the Prohibition of Benami Property Transactions Act, 1988. The Central Board of Direct Taxes altered this law significantly through a notification on October 25 last year.

According to estimates of experts dealing in property registrations in Mumbai, there would be at least 500,000 agreements worth Rs 1 crore or more from the past 10 years.

“Without doubt one of the primary destinations for unaccounted money is real estate. Almost all of it is held in benami properties," said Dinesh Kanabar, chief executive officer, Dhruva Advisors LLP

He added the efforts of the tax authorities were aimed at scrutinising data to find out property acquired from unaccounted sources or were held in someone else’s name. “This is an effort in the right direction."

To ensure all types of property transfers are covered, the department has asked sub-registrars to provide details of all registrations — development agreements, tenancy transfers, certificates of sales, flat/office/commercial premise sales, amalgamations-demergers, exchange of properties, gifts, lease agreements (with deposit over Rs 1 crore), mortgages, power of attorneys, surrender/partitions of properties/rights, release deeds, transfer of lease, and works contracts.

The list covers the whole gamut of property transfers. The I-T department has asked for names, address and PAN numbers of sellers and buyers, along with the value of the agreements vis-à-vis the market value, details of properties, and registration dates.Kanabar said, “Properly directed, such an inquiry can go to the root of the issue: Who the real owner of a property is, and can
unmask benami holders. The amended law gives sufficient powers to the authorities to deal with cases where properties are held in someone else’s name."

Sources said the information received will be used with analytics to find out mismatches and identify suspected benami holders.They would be sent notices.

Kanabar said, “What has been a matter of concern is whether these are roving enquiries or have a basis to go by, and also whether after gathering the information that revenue authorities are providing there would be a follow-up mechanism to take the inquiries to a logical conclusion. This has been lacking in the past. Also, property owners who are not in violation of the law should not
be harassed."

According to the 1988 Act, once a piece of property is established to be benami, it can be seized by the authorities.

Net to catch untaxed wealth 

Benami properties are a favourite of those seeking to hide unaccounted money

Total deals

About 50,000 deals of Rs 1 crore are made every year. I-T department should get information of about 500,000 deals over past 10 years

Details sought

Buyers and sellers names, PAN, and agreement and market values

Under cover

Actual number of deals of Rs 1 crore or higher could be far more, as most agreements are made at ready reckoner rates — accepted market
value for paying stamp duty

Business Standard, New Delhi, 19th July 2017

Comments

Popular posts from this blog

RBI minutes show MPC members flagged upside risks to inflation

RBI minutes show MPC members flagged upside risks to inflation Concerns about economic growth and easing inflation prompted five of the six monetary policy committee (MPC) members to call for a cut in the repo rate, but most warned that prices could start accelerating, show the minutes of the panel’s last meeting, released on Wednesday. The comments reflected a tone of caution and flagged upside risks to inflation from farm loan waivers, rise in food prices, especially vegetables, price revisions withheld ahead of the goods and services tax, implementation of house rent allowance under the 7th pay commission and fading of favourable base effect, among others. On 2 August, the panel chose to cut the repurchase rate—the rate at which the central bank infuses liquidity in the banking system—by 25 basis points to 6%. One basis point is one-hundredth of a percentage point. Pami Dua, professor at the Delhi School of Economics, wrote that her analysis showed “a fading economic growth outlook, as …

Shrinking footprints of foreign banks in India

Shrinking footprints of foreign banks in India Foreign banks are increasingly shrinking their presence in India and are also becoming more conservative than private and public sector counterparts. While many of them have sold some of their businesses in India as part of their global strategy, some are trying to keep their core expertise intact. Others are branching out to newer areas to continue business momentum.For example, HSBC and Barclays Bank in India have got out of the retail business, whereas corporate-focused Standard Chartered Bank is now trying to increase its focus on retail “Building a retail franchise is a huge exercise and takes a long time. You cannot afford to lose it,” said Shashank Joshi, Bank of Tokyo-Mitsubishi UFJ’s India head.According to the Reserve Bank of India (RBI) data, foreign banks’ combined loan book shrunk nearly 10 per cent from Rs 3.78 trillion in fiscal 2015-16 to Rs 3.42 trillion last financial year. The banking industry, which includes foreign banks…

Differential Tax Levy under GST: Food Firms May De-Register Trademarks

Differential Tax Levy under GST:Food Firms May De-Register Trademarks The government’s decision to charge an enhanced tax rate on trademark food brands is leading several rice, wheat and cereal manufacturers to consider de-registering their product trademarks. Irked by the June 28 central government notification fixing a 5 per cent goods and services tax (GST) rate on food items packaged in unit containers and bearing registered brand names, the industry has made several representations to the government to reconsider the differential tax levy, which these players say is creating an unlevel playing field within these highly-competitive and low-margin industries. Sources say that the move has affected the packaged rice industry the hardest and allowed the un-registered market leaders, India Gate and Daawat, to gain advantage as compared to other registered brands such as Kohinoor and Lal Qilla. Smaller players are even more worried with this enhanced rate of tax (against the otherwise …