New Delhi: The Income Tax department on Sunday warned the bank account violators that they will face seven year jail term if they deposit their unaccounted old currency in someone else’s account.
The tax department also said that it has decided to slap charges under the new Benami Transactions Act against the violators.
“The CBDT has asked the Income Tax department to closely monitor all such transactions where people are using bank accounts of other persons for hiding and converting into white their black money using the old currency notes of Rs 500 and Rs 1000.
“Already some instances have been reported in this regard and the department is set to issue notices under the Benami Act,” sources said.
If a person deposits Rs 500 and Rs 1000 old notes in the account of another person in order to get new currency, the transaction shall be regarded as benami transaction.
“Such an arrangement where a person deposits old currency of Rs 500 and Rs 1000 in the bank account of another person with an understanding that the account holder shall return his money in new currency, the transaction shall be regarded as benami transaction under the said Act.
“The person who deposits old currency in the bank account shall be treated as beneficial owner and the person in whose bank account the old currency has been deposited shall be categorised under this law as a benamidar,” a senior official told media.