The Income Tax department has decided to block Permanent Account Number (PAN) and cancel the LPG subsidy of wilful tax defaulters. In a series of tough measures to cripple and check the activities of any entity indulging in wilful violation, the defaulters may face from arrest to even refusal of their loans from banks and financial institutions.
Officials have been directed not to shy away from the rare provisions of arrest, detention and auctioning of attached assets of wilful income tax defaulters. For wilful evasion of taxes, Section 276 C (2) of the IT Act provides for rigorous imprisonment for a period between three months and three years which may be accompanied by a fine.
A number of such measures have been mooted by the tax department, to be undertaken this financial year, in order to curb the menace of large-scale tax avoidance and evasion.
According to preliminary reports, a strategy paper has been prepared by the department, listing proposals like blocking PAN and taking measure where the “defaulters are not sanctioned any loans or overdraft facility by public sector banks, as the same is bound to become non-performing assets”.
Further, it said, “Ministry of Finance can be suggested to withdrawn facility like LPG subsidy which is directly credited in to the bank accounts of the said defaulters.”
The taxman also proposes that the identities of such blocked PANs be circulated to the Registrar of Properties “with a request for not allowing any registration of immovable properties where such PANs are involved.”
Such defaulters’ information has also been recommended to be circulated across tax offices so that their activities, loans or government subsidy can be plugged country-wide.
The department has also decided to subscribe to the Credit Information Bureau Limited (CIBIL) data, on a possible payment basis, to check out the financial activities of defaulters and undertake action against them for recovery and freezing of assets.
The department, beginning last year, has also started to ‘name and shame’ large tax defaulters (over Rs 20 crore default) by publishing their names and other credentials in leading national dailies and on its official web portal. Till now, 67 such entities have been put in public domain by the department.
“Tax default is a major menace that the department is grappling with. These new measures are aimed to curb these instances in the right earnest,” a senior IT department official told the news agency.
(With inputs from the PTI)