The Confederation of All India Traders (CAIT) today sent a letter to the Union Finance Minister Smt. Nirmala Seetharaman requesting tha the date of appeal in thousands of notices sent to jewellers and other sections of business across the country including may be extended beyond 31 January 2020 so that traders across country can file appeal in response to the notice sent by the Income Tax Department. The CAIT has also urged that concession should also be given in the provision of depositing 20 percent while filing any such appeal. On the other hand, CAIT has sent a separate letter to the Union Minister of Consumer Affairs, Shri Ram Vilas Paswan, urging that some necessary changes be made in the complexity of the Hallmark law applicable to the jewellery sector. The CAIT clearly stated that it is not advocating to protect any kind of tax evasion or violation of law by anyone. If anyone has engaged into said activities, the law should follow its own course.However, due precaution is required so that small traders of jewellery should not be wrongly implicated.
It is recalled that after demonetisation, the cash sale which was done by the jewellery and other traders from November 8 to December 30, 2016, was deposited in the banks and such sale is duly recorded in the accounts and cash book. However, the Income Tax Department, while not recognizing the cash sale as routine business sales, treated the said amount as unexplained and added it to the taxable income under Section 68 and Section 69 of the Income Tax on which income tax has been imposed at 60% under Section 115BE of Income Tax together with surcharge and interest on advance tax deposited at lesser value. In this way the total demand by the department has become equal to the amount deposited by the traders.
About a month ago, a large number of jewellers and other commodities traders have been served notices for tax recovery due to liability of paying lakhs and crores of rupees has been devolved on traders.The last date to file an appeal against these notices is January 31, 2020 and before filing the appeal, the traders will have to deposit 20 percent of the liability to the department only then the appeal will be accepted. However, according to the law, the tax officer has the right to reduce the amount of 20 percent according to his discretion, or that the appeal can be heard without depositing the amount.
Mr. Praveen Khandelwal, Secretary General of CAIT said that thousands of notices have been sent across Country including even the small traders who get the goods manufactured from artisans and sell them in the market. It is possible that some people have tried to misuse the law and such people must be prosecuted according to the law, but there are also a large number of traders for whom serving notices is not justified. Keeping this fact in mind, CAIT has urged Finance Minister Smt. Nirmala Seetharaman that in pursuance of principle of natural justice, the date of appeal may be extended beyond 31st January,2020 and the condition for depositing 20% amount of the total amount may be waived off so that Even the small traders can seek justice by way of appeal. He said that Prime Minister Shri Narendra Modi has said many times that no action should be taken against any businessman without any valid reason in possession with the Department and such while taking a lenient view, the appeal amount may be waived off.
In a separate letter sent to Mr. Ram Vilas Paswan, the CAIT has said that it is welcome to put Hallmark on every item of jewellery which will strengthen the confidence of consumers about the quality of jewellery but some provisions in Hallmark law are very complicated to follow by small traders.In this context, the National Convenor of All India Jewellers and Goldsmith Federation, Mr. Pankaj Arora has urged Mr. Paswan to have a meeting with Jewellery traders to consider all the provisions of the Hallmark Act so that complicated provisions can be simplified and jewellery traders across country can easily and conveniently comply with Hallmark law. He said that the jewellery sector is an important part of the country’s business and is already facing many challenges. A large number of small traders work in this sector and employ millions of artisans. From this point of view, it is very important to resolve the core issues of this sector!