Black Money Act 2015 (BMA): Government Review Panel
Why in the news
An internal government committee is reviewing the Black Money Act (BMA), one of India’s strictest tax laws, looking at enforcement problems, conflicts with the Income Tax Act and better handling of hidden foreign assets.
Key facts
- Purpose: tax and penalise undisclosed foreign income and assets of Indian residents.
- Coverage: residents, citizens and entities they control.
- Tax: 30% plus surcharge and cess; penalty can equal the tax.
- Jail: 3 to 10 years for wilful concealment or misreporting.
- Voluntary Disclosure Schemes: periodic windows to disclose, pay and avoid prosecution.
- Reporting: foreign holdings go in annual returns, cross-checked with foreign data.
Contested provisions
| Issue | BMA | Income Tax Act |
|---|---|---|
| Look-back | Decades-old assets can be probed; under Section 72(c) the discovery year is the income year | 5 years if escaped income is ₹50 lakh or more; otherwise 3 |
| Cost | 30% tax plus 90% penalty, 120% of asset value | Maximum 90% |
| Non-reporting | An unreported asset can bring prosecution even if lawfully acquired | Prosecution only for evasion |
| PMLA | Scheduled offence, so ED can act | Not mentioned |
Exam angle
- Act year 2015; tax 30%, penalty 90%.
- Related terms: Section 72(c), PMLA, ED.