Money ... Black is Beautiful!

Sir,
What about the domestic black money.
1. Real Estate - huge gap in the actual price vis-a-vis transaction price - in most of the places the difference could be many fold.
2. All the showrooms in the markets - big cities, small cities, towns and even villages - daily sales trasanction is few lakh to few crores - either not paying any tax or paying a fraction of tax - as there are no books of accounts, no sale invoices. I know many in my city - who do not know - what is income tax and owns many properties as they are flush with cash and the only place is to buy either gold/silver or immovable property. SHould there be not a "composition scheme" for income tax on such traders, shopkeepers.
3. This category is of the "marriage homes/places/farms" mushrooming every where - they do not pay service tax - as most of them are not registered - double dhamaka for them - avoid service tax and income tax both. Few of them are smart enough to charge service tax and collect but not paying.
4. Instead of audit of the registered/PAN holders - the crowd in the CBEC should be deployed to monitor these establishments - this will add to indirect tax collection and indirectly would add direct tax collection also. Going rate of these places is anywhere between 10 lakhs to crore - imagine the amount of service tax, VAT and income tax being evaded. Our officials and ministeres are also happy to attend such gatherings without mindful of the evasion.
5. Then you have the private schools from kindergarden to higher levels - many of them are pure commercial - cahrge huge fees and pay little to thier staff. No PF, no TDS and no income tax on income. I have seen my neighbourhood schools have grown from one room play school to a medical college besides few senior secondary schools - the director/promotor/malik - have progressed to 1000 sqaure meter houses with fleet of big cars - but pay a pittance as income tax.
There is a need to take a holistic view and concrete use of work force to collect tax from the non-payers is required but the babus always find ways to arm twist the companies paying good amount of tax but not servicing the babus who comes for audit as a routine once in a year and other wise also, completely ignoring the EA 2000 Audit manual which mandates the risk profiling - there is no such profiling and no body is ever told of the risk. Just see the auditors raising a para for reversal of some cenvat credit of few lakh in a company which pays 1200 crores of excise duty out of which 45% is though PLA, what a risk??

The views are strictly personal.

Arbind Aggarwal

Arbind Aggarwal 23/08/2014