A New Scheme, Yet to be notified: To Convert Black Money into White Money

The great step of PM Modi on demonetization of Rs. 500 and Rs. 1000 currency notes makes chaos and difficulties for the general public. People get worried and hurried in order how they can exchange and deposit their old currency notes. To counter the demonetization problem black money holders started deposits in the accounts of their relatives, servants, workers, poor peoples, etc. These all transactions are illegal under the Amended Act of Benami transaction and all people involved in these transactions are liable to imprisonment or fine and even both.

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As to prevent these illegal transactions, a new scheme is yet too notified under which all black money holders are given an opportunity to convert their black money into the white money.

Here the outline points are:

  1. This scheme may be called PRADHAN MANTRI GARIB KALYAN YOJNA 2016 and it will be applicable when government notifies it.
  2. To avail this scheme, person needs to give declaration under newly inserted chapter IX A. Any person can avail this scheme by making a declaration of any income, in form of cash or deposit in an account maintained by the person with the:

Any Banking Company including scheduled commercial banks etc.,

Reserve Bank of India (RBI),

The head post office or the sub post office.

(However some persons are not allowed to convert their money as notified by the scheme).

  1. The tax on the undisclosed income will be 49.9%, where there is no limit on size of income.
  2. Apart from the tax paid @ 49.9%, a person making declarations shall have to deposit the sum @ 25% of the undisclosed income for four years. This deposit will not carry any interest.
  3. Payment of taxes as stated above shall be made before filling the declaration. The Challan of payment shall be submitted along with the declaration.
  4. After filling the declaration in consonance with the rules prescribed, the person shall also be immune from the prosecutions.

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