Black Money: RBI directs banks to accept tax payment in cash

The Reserve Bank of India has advised banks to accept cash from all their customers who plan to pay their taxes through cash at the counters. 

RBI said," The banks have been advised to ensure their branches invariably accept cash from all their customers who desire to deposit cash at the counters."

The banks are also directed to refrain from incorporating clauses in the terms and conditions which restrict deposit of cash over the counters. 

After the announcement of Income Decelaration scheme which came into effect from June 1, 2016, it was expected that some decelarants who would like to pay their tax dues in cash. 

Following this, it was brought to the central bank's notice by the Government of India, that some banks have been hestitating in allowing deposits of large amounts via cash by the declaranrs under the scheme, crediting the amount under goverment account. 

Clearing the deck, the RBI said the amounts to be accepted under the scheme through challan ITNS-286. 

Also in this connection, the banks are asked to comply with the Know Your Customer (KYC) requirements for customer and walk-in customer as contained in Master Direction - Know Your Customer Direction, 2016 in effect from February 25,2016. 

By ending the instruction, RBI asked banks to immediately issue appropriate instruction to their respective branches as indicated above so that the declarants don't face any difficulty in the process. 

In a move to clear black money, the Government of India launched Income Declaration Scheme as an opportunity to people who haven't paid full taxes in the past can come forward and declare their undisclosed income and assets. 

To eliminate inconvenience and facilitate smooth process of filing tax returns under the Income Declaration Scheme (IDS), the Central Board of Direct Taxes (CBDT) has extended the date for taxpayers to October 17, Zee Business news channel reported on Friday.

Earlier the scheme was open for declaration till the end of September, 2016. 

The tax payers whose business receipts exceed Rs 1 crore or professional receipts exceed Rs 25 lakh during the previous year 2015-16 are required to file an Income Tax Return (ITR) accompanied by an audit report by the above mentioned due date, it said.