CBDT effluviums Travel Khanna claim saying they didn’t emptied account under Angel Tax Provision

Key Highlights

CBDT has seized all 4 bank accounts of Travel Khanna and took complete Rs. 33 Lakhs and Rs. 77 lakhs from the account of Babygogo.

Angel Khana was unable to describe CBDT source of some deposits of worth nearly Rs. 2.22 Crore in their account.

Angel Khana unable to submit any certificate from Department for Promotion of industry and internal trade stating the status of as “startup”.

Related: Government relaxes Angel Tax norms, reforms definition of a startup

Two Indian startups claimed that Central Board of Direct Taxes (CBDT) deducted lakhs of money from their account by deducting angle tax but CBDT has slammed their claim. Travel Khanna a Noida based food delivery start-up claimed that that CBDT has seized their all 4 bank accounts and took complete Rs. 33 Lakh from them. Another startup Babygogo founded by Siddhartha Ahluwalia also claimed taxman Rs. 77 lakhs from their account under Angel Tax.

On defying their claim CBDT issued a statement stating, “Travel Khanna’s account was emptied for a case made under Section 68 of income tax act  – that appertains to unauthorized cash credits not under Section 56(2)(viib) i.e. angle tax provision.”

Related: CBDT effluviums Travel Khanna claim saying they didn’t emptied account under Angel Tax Provision

When CBDT assessmented Angel Khana they were unable to describe the source of some deposits of worth nearly Rs. 2.22 Crore. Moreover, startup didn’t obtain any stay on the demand raised. After not receiving any stay from the startup CBDT has to recover Rs. 36 from the attached bank account.

The taxman also said that Travel Khanna or its directors didn’t submit any certificate from the Department for Promotion of industry and internal trade stating “the status of a startup”. If the certificate would have been furnished then this condition has not arrived, the taxman said.

CBDT said, “If entrepreneurs didn’t provide the record of funds to Income tax department even after several remainders then it is left with no other choice rather than releasing all amount from their bank account.”

CBDT also clarified about the confusion raised by several startups concerned to Angel Tax, The Angle tax is raised when a startup raises funds more than its “fair valuation”. According to a survey of Indian Private Equity and Venture Capital Association had found over 73 percent of 2,500 startups that raised Capital between Rs. 50 lakh and Rs. 2 Crores has received Angel Tax Notice. 

The IT department also recovered Rs. 72 Lakhs from Babygogo. Stay connected with us for further updates!