CBDT Amends Black Money Act Instructions to Exempt Minor Foreign Assets

Instruction- F.No 285/46/2021-IT(Inv.V)/88, dated 18th August 2025

Background and Objective of the Amendment

The Central Board of Direct Taxes (CBDT) has amended its earlier instruction issued under Section 84 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015 (BMA, 2015). The purpose of this amendment is to provide relief to individuals who may have inadvertently failed to disclose minor foreign accounts or assets due to oversight or lack of awareness. By updating the earlier framework, CBDT aims to ensure that genuine cases involving assets of small value are not subjected to harsh prosecution measures.

Impact of Finance (No. 2) Act, 2024

This change follows the amendments introduced by the Finance (No. 2) Act, 2024, which became effective from 1 October 2024. The Act substituted the proviso to Sections 42 and 43 of the BMA, 2015, and clarified that these provisions shall not apply to an asset or assets (other than immovable property) where the aggregate value does not exceed ₹20 lakh. This statutory relief was a significant shift from the earlier threshold, allowing individuals with low-value foreign assets to avoid the penal consequences that previously applied.

Need for Alignment with Earlier Instruction

Despite the legislative amendment, the earlier CBDT Instruction dated 15 March 2022 continued to provide immunity only for assets covered under the pre-amended provisions. This discrepancy created uncertainty for taxpayers and enforcement authorities. To resolve this, CBDT has now revised its direction to bring it in line with the updated statutory provisions. The revision ensures consistency and prevents unnecessary prosecution in cases where the law itself does not envisage penal action.

Revised Instruction and Its Implications

As per the amended Instruction, prosecution under Sections 49 and/or 50 of the BMA, 2015 shall not be initiated if penalty under Sections 42 and/or 43 is not levied or is not leviable. This specifically applies to foreign assets (other than immovable property) whose aggregate value does not exceed ₹20 lakh at any point during the relevant previous year. The move provides much-needed clarity, strengthens taxpayer confidence, and balances enforcement with fairness by focusing on significant cases of black money while excluding minor, unintentional lapses from penal consequences.

Click Here To Read The Full Notification