“A friend in need is a friend indeed.” You live by this rule. You are willing to do anything for your friends. Some friends of yours have asked you to deposit a little black money, into your bank account. Do this favor for us they say….We will never forget this kind deed…After all what are friends for?
You are tempted to help your friends. A few minutes is all it will take, to use your bank account and convert their black money, to white. Who will know? Your friends then owe you a favor for life….This is what the tax department says….If you deposit someone else’s money in your bank account, be prepared to pay a fine and be punished with rigorous imprisonment from 1 year to 7 years.
The tax department has widely publicized this in newspaper advertisements, warning you of the consequences of making illegal deposits. Still tempted to help your friends? Think again. Need help with your tax planning? Just leave a missed call on IndianMoney.com financial education helpline 02261816111 or just post a request on IndianMoney.com website. IndianMoney.com offers Free, Unbiased and on-call financial advice on Insurance, Mutual Funds, Real Estate, Loans, Bank Accounts and capital markets.
A number of our poor citizens are renting out their bank accounts, to help unscrupulous people and black money hoarders, convert black money to white. Poor citizens get paid to do this and….they need the money. Black money hoarders deposit illegal money in old 500 and 1000 rupee notes, in bank accounts of poor citizens, to escape tax authorities. This money is later withdrawn, as white money.
Now, your friends want you to deposit their illegal black money, stored in old 500 and 1000 rupee notes, in your bank account. You don’t have much of your own money, in your bank account. Will the tax department notice a little extra money coming in? Your friends will pay you for this service. You could make some quick money….The tax department will slap charges against you, under the newly enforced Benami Transactions (Prohibition) Amendment Act, 2016. You could be fined, prosecuted and punished with rigorous imprisonment, up to a maximum of seven years.
The tax department is conducting a nationwide operation, to identify suspect bank accounts, where huge cash deposits have been made, after November 8th 2016. (The Government scrapped 500 and 1000 rupee notes on this day). If the tax department suspects that your bank accounts are being used to deposit illegal black money, then you could be prosecuted under Benami Property Transactions Act, 1988. The tax department will prosecute both you (depositor) and your friend (person whose illegal money he or she has "adjusted" in their account).
Your friend has deposited illegal black money in old 500 and 1000 rupee notes, in your bank account. The tax departments considers your friend as the “beneficial owner”. You have deposited your friends black money in your bank account. The tax department considers you as the “Benamidar”. Under the Benami Act, both the benamidar and the beneficial owner and any other person who helps in the Benami transaction, will be imprisoned for a term, ranging from 1 year to 7 years. You could be fined and the benami amount in your bank account, seized.
Jan Dhan accounts meant for the poor, are filled with more than INR 27,000 crores. Most of this money has been deposited in the last two weeks. The suspicion is that Jan Dhan accounts, are being used to help black money hoarders, convert black money to white. A stern warning from the Prime Minister of India. Strict action will be taken against unscrupulous elements, using Jan Dhan accounts of the poor, to park black money. This would be done under the tough Benami Laws. Be Wise, Get Rich.
Mr C.S.Sudheer is a management graduate. He started his career with ICICI Prudential Life Insurance and later on worked with Howden India. After his brief stint in Howden India, he moved on and incorporated Suvision Holdings Pvt Ltd which is the sole promoter of IndianMoney.com. He aims to build a nation that is financially literate with investment savvy citizens.