New Delhi, Dec 5: The government said on Sunday that it had rejected a declaration of Rs 2 lakh crore made under the Income Disclosure Scheme (IDS) by four members of a Mumbai family as it was found to be "suspicious" and was made by persons with "very small means".
Their declaration of Rs 2 lakh crore was nearly three times the size of the IDS mop-up estimated by the government. The tax department said it was probing the false declaration.
The government also said that the I-T department had rejected Ahmedabad-based Mahesh Shah's declaration of Rs 13,860 crore. Shah had gone missing after making the declaration, only to surface on Saturday. On questioning, he claimed he had made the disclosure on behalf of certain politicians and bureaucrats.
In a statement, the I-T department said the two declarations had not been included in its IDS calculations. Finance ministry sources said the Rs 2lakh crore declaration looked suspicious from the word go as basic details such as the mobile number could not be verified.
What raised suspicions further were allegations that the disclosure was being used to launder money post-demonetisation and "convert black money into white".
Based on feedback, the government decided to reject the declarations on November 27, three days before the deadline to pay the first instalment of tax and penalty under the IDS. The government also revised the overall amount received under IDS after the payment of the first instalment — from Rs 65,250 crore to Rs 67,382 crore. The number of declarants has increased from 64,275 to 71,726.
The IDS had allowed those with black money to declare hitherto undisclosed income by September and pay 45% as tax and penalty.
The first instalment of tax was to be paid by November 30. The government had described the scheme as a success but the two rejections have brought an attack from the opposition, which is already putting pressure on the government to open a fresh window for those with undisclosed cash in the wake of the demonetisationmove.
"There is a Rs 13,860 crore hole in the Rs 65,000 crore IDS! How many more holes?" former finance minister P Chidambaram tweeted, referring to Shah's declaration.
Meanwhile, the residents of Mumbai's Jubilee Court co-operative housing society, located on Linking Road in Bandra (West), were surprised to hear that the family which declared an income of Rs 2 lakh crore had listed the building as their address.
Flat number 4, cited as address by the Sayeds, is located on the ground floor of Jubilee Court. The name plate on the flat's door reads 'R R Vaid'. "Vaid sold his flat around 10 years ago, and it has since been resold several times. We don't know who the current owner of the flat is," said an occupant. Jubilee Court has 10 residential flats.
"The Sayed family you are talking about never lived here. The flat is up for resale," said Michel, the main broker for the said flat. When asked who the current owner of the flat was, he refused to answer, saying he would reveal it only to a potential buyer. "I have been negotiating with a family to sell this flat. They came to see this flat on Sunday evening and, seeing the media crew, they left," J Kapoor, a sub-agent of Michel, said.
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