Modus Operandi: How black money hoarders are trying to escape I-T lens

I-T dept has sent 600 notices to jewellers across 25 cities, asking them to detail daily sales

A jeweller flew from Bengaluru to Goa, checked into a five-star hotel, sold jewellery worth Rs 45 lakh to a doctor staying in the same hotel, only to be busted by the income-tax (I-T) sleuths. A search on the buyer led to recovery of Rs 3 crore worth of jewellery.
 
This is one of the modus operandi by black money holders to use their scrapped Rs 500 and Rs 1,000 notes, cracked by the tax department since the government’s demonetisation move on the midnight of November 8.
 
“A door-to-door sale is being offered by jewellers to their old or loyal customers. We will nab them all, irrespective of the cities they are carrying out these rackets,” said a senior Central Board of Direct Tax (CBDT) official.
 
The I-T department says it is getting black money holders dodging the system under its lens. They have, it says, been using innovative ways to get rid of old Rs 500 and Rs 1,000 currency notes. In one instance, the department found sale of a diamond necklace was split into four bills, with different permanent account numbers (PANs).
 
Jewellers are formally required to take the PAN of a buyer purchasing jewellery for more than Rs 2 lakh.
 
The department has sent around 600 notices to jewellers across 25 cities, asking them to detail daily sales. Those in major cities are under scrutiny in this regard; this could later extend to other cities.

The sources said people are sending up to 25 domestic help to exchange notes from different banks.
 
In response, the finance ministry first made it mandatory to apply indelible ink on persons exchanging notes and, then, on Thursday, lowered the limit of money that can be exchanged from Rs 4,500 to Rs 2,000.
 
The sources said surveys are being conducted to detect errant assessees. “They are misusing the generosity,” said one.
 
CBDT Chairman Sushil Chandra is learnt to be doing regular video conferencing, with I-T officers taking updates from the surveys.

READ OUR FULL COVERAGE ON THE MODI GOVT'S DEMONETISATION MOVE