In the wake of the demonetisation exercise, the income tax department has turned the heat on NGOs run by tax-exempted trusts.
The I-T department has asked NGOs depositing Rs 2.5 lakh or more to show their cash balance as on March 31, 2016, and on November 8 when Prime Minister Modi announced the demonetisation.
“We get information on accounts which got deposits over Rs 2.5 lakh in cash. Once we get the information, we check the company’s or individual’s I-T returns and send a notice asking them for documents, bills, vouchers and other papers to validate the source of cash,” a senior I-T official said on condition of anonymity.
“We got notices from the I-T department a few weeks after the Union home ministry cancelled the Foreign Contribution (Regulation) Act 2010 (FCRA) registration or asked for more documents. This follows information that many people are using NGOs to launder black money,” Voluntary Action Network India (Vani) chief executive officer Harsh Jaitli told TOI.
The senior I-T official said, “We will get details of the cash balance on hand between March 31 and November 8. We will also look at deposits in cash after November 8. If the cash on hand and what has been deposited do not tally, then the NGO is in trouble”.
Meanwhile, Vani, in an advisory, said, “We would like to advice all members, associates and friends not to accept heavy donation or unaccounted cash transaction. Some people are offering lucrative incentives to launder their black money through charitable institutions”. (Agencies)