Black money could be used to threaten national security: HC
Srinagar: While pronouncing the judgment in a case , the J&K and Ladakh High Court noted that the Black Money could be used to threaten national security.
“Stashing away of black money abroad by some people with the intent to evade taxes has been a matter of deep concern to the nation. Black Money is a common expression used in reference to tax-evaded income,” the court said.
Evasion of tax, the court said, robs the nation of critical resources necessary to undertake programs for social inclusion and economic development. “It also puts a disproportionate burden on the honest taxpayers as they have to bear the brunt of higher taxes to make up for the revenue leakage caused by evasion”.
While the court noted that the money stashed away abroad by evading tax could also be used in ways which could threaten the National Security, it said the Supreme Court has also expressed concern over this issue.
The court said that a Special Investigation Team constituted by the Central Government to implement the decisions of the Supreme Court has also expressed the views that measures may be taken to curb the menace of black money.
“Internationally, a new regime for automatic exchange of financial information is fast taking shape and India is a leading force in this effort,” the court said, adding, “The new legislation has been enacted to apply to all persons resident in India and holding undisclosed foreign income and assets.”
Underscoring that a limited window is proposed to persons who have any undisclosed foreign assets, the court said: “Such persons may file a declaration before the specified tax authority within a specified period, followed by payment of tax at the rate of 30 per cent and an equal amount by way of penalty.” Upon fulfilling these conditions, the court said, a person shall not be prosecuted under the Bill and the declaration made by him will not be used as evidence against him under the Wealth Tax Act, the Foreign Exchange Management Act (FEMA), the Companies Act or the Customs Act.
“ It is merely an opportunity for persons to become tax compliant before the stringent provisions of the new legislation come into force”.