Penalty N Prosecution under I/T Act

This query is : Resolved

Bijoy Ranjan Dey (Querist)
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25 April 2009 On a close scrutiny of the bANK aCCOUNT of one client, it was learn t that he had opened a SB bank account with ICICI Dibrugarh(Assam) after singing that he wasnt a income tax assesse, on around OCT 2008. Later in 5\4\2009, he came to a Delhi and Asked the Cannought Place Branch to update his TAX details and furnished them with with PAN card xerox which had been issued to him in 2001.

Queries:
1) What is the postion from Income TAX point of view? Can he be held responsible for falsification of the fact that he had initially signed to be not a income tax assesse?
2) If yes, what are the penal provisions? Specially, is he liable to criminal proceeding?
3) If No, what is maximum penalty liable to to be paid ?
4) When will the IT department come to know that he had falsified the truth?
5) Similarly, can the bank charge him for any offence under Banking Regulation Act, 1949?
6) The contention of the client was that, he was in URGENT need to open the account. The employee of the Bank had VERBALLY asked him to opt for this procedure, which he did. That point of time he wasnt in a position to give them with a Xerox copy of the PAN. So he opened the account and aftr few months when he was in a position to give the details, he gave it to the bank. Is the aurgument of the client valid?

CA. B.SRINIVASULU

CA. B.SRINIVASULU (Expert)
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25 April 2009 The argument of the clien is not valid.

If the person quotes wrong pan then he is liable for a penalty of Rs.10000/- Not giving the available pan also comes under the purview of wrong pan.

From the point of view of income tax department the assessing officer will verify whether the transactions has been reflected in the accounts filed by him. If those transactions are reflected then there is no much penalties other than 10000 which is mentioned above.

The department will come to know when the forms submitted by you to the bank reaches the it department.

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