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The Finance Ministry on Monday informed the Lok Sabha that Scheduled Commercial Banks (SCBs) have written off loans worth ₹5.85-lakh crore. It also said that declarations received under Vivad Se Viswas Scheme accounted for around 28 per cent of pending tax disputes.
Minister of State in the Finance Ministry Anurag Singh Thakur in a written response said as per RBI data, SCBs have written-off loans of over ₹2.36-lakh crore in FY 2018-19, ₹2.34-lakh crore during FY 2019-20 and over ₹1.15-lakh crore during the April-December period of FY 2020-21.
As per rules, non-performing loans, including those in respect of which full provisioning has been made on completion of four years, are removed from the balance-sheet of the bank concerned by way of a write-off.
As borrowers of written-off loans continue to be liable for repayment and the process of recovery of dues from the borrower in written-off loan accounts continues, write-off does not benefit the borrower.
Thakur said that during the last two financial years and the first three quarters of the current financial years, SCBs recovered over ₹68,000 crore from the written off loan accounts.
Vivad Se Viswas Scheme
In another un-starred question, Thakur said that a total of 1,28,733 declarations have been filed till March 1 under the Vivad Se Viswas Scheme. These include 1,393 declarations by Central PSUs and 833 declarations by State PSUs/ boards. Declarations have been filed by taxpayers for resolution of tax disputes amounting to ₹98,328 crore till March 1. Taxpayers have made a payment of ₹53,346 crore under the scheme.
The total number of pending tax disputes as on the eligibility date was 5,10,491. The 1,28,733 declarations relate to 1,43,126 pending disputes (including cross appeals). “Thus, the declarations received under the scheme cover more than 28 per cent of pending tax disputes,” he said.
Senior citizens
In response to a question related to budget provisions for senior citizens, Thakur said that the Finance Bill, 2021 has proposed to insert a new section to provide exemption for persons over the age of 75 years from filing income-tax returns. This is subjects to the condition that the said person has only pension income and no other income.
However, in addition to such pension income he may have also have interest income from the same bank in which he is receiving his pension income.
Further, this bank is required to be a specified bank. The government will be notifying a few banks as specified banks. The pensioner will be required to furnish a declaration to the specified bank.
Once the declaration is furnished, the specified bank would be required to compute the income of such senior citizen after giving effect to the deduction and rebate allowable and deduct income tax on the basis of rates in force. Once this is done, there will not be any requirement of furnishing return of income by such senior citizen for this assessment year.
“This amendment will take effect from April 1, 2021,” Thakur said.
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