IT department sends notice to societies and trusts to reveal their cash balances

New Delhi: Income tax department is sending notices to Societies and Trusts, across the country to reveal their cash balances,  in light of the demonetisation plan announced by Prime Minister Narendra Modi on November 8.

To enforce these trusts to furnish relevant information, the income tax department is sending these notices under Section 133(6) of the Income Tax Act, 1961.

This section give the IT department power to compel banks and other authorities to furnish information which is useful in connection with any ongoing investigation, said sources.

Societies and Trusts have been asked to submit cash balance as per their books of accounts of all the institutions being run by them as on March 31 and as on end of November 8 to the income tax department by Friday.

“Failure to comply  within time may attract penal provisions,” warned income tax officials.  Income tax officials said that this is a preventive measure to ensure that these institutions are not misused by people who want to convert their black money into legitimate earnings.

The income tax department in its notice asked trusts and societies not to deal with the old currency notes of Rs 500 and Rs 1,000 by either accepting cash or paying in cash for any of their activities.

“In the backdrop of demonetisation plan of the old notes, the department is also aware of the pressure or temptation that may be there on Trusts and Societies, to accommodate outsiders. As a preventive measure, you are hereby requested to submit cash balances of accounts for all the institutions run by you,” the IT department said.