The Income Declaration Scheme 2016 Certain Aspects

Last year, it was a one-time compliance window under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 ('the BM Act') to report the undisclosed offshore assets. Now it is an Income Declaration Scheme, 2016 ('IDS, 2016') to declare undisclosed income from a domestic source. 

The former scheme received lukewarm response in terms of tax yield, given the high tax rate (60% incl. tax and penalty) and the concept of fair market value for valuing the asset for computing the tax liability. Further, the current scheme has some similarities (discussed at appropriate places) with the earlier schemes (scheme of 1965, 1975 and 1997) and, therefore, the CBDT instructions / clarifications and the judicial pronouncements interpreting these schemes shall be useful.