Tax deducted from bank accounts of start-ups; I-T department clarifies

The CBDT clarified that the additions in tax demands have been made using provisions of Section 68 of the I-T Act

Two start-ups, TravelKhana and Babygogo, have claimed that the income-tax (I-T) department withdrew lakhs from their bank accounts for angel tax it feels they are liable to pay.

The department had allegedly frozen four bank accounts of TravelKhana (Duronto Technologies) and withdrew about Rs 33 lakh on investments raised by the company from angel investors in 2015-16. Babygogo got an SMS alert from its bank showing a negative balance of Rs 72 lakh, but it did not have much in its account.

In the case of TravelKhana, its founder and Chief Executive Officer (CEO) Pushpinder Singh has said the Central