I-T Dept to Examine 87,000 With Big Deposits During Demonetisation

Notices were issued to 3 lakh people, out of which 87,000 made deposits of over Rs 2 lakh during demonetisation.

An Indian counts currency notes of 1,000 and 500 denomination in New Delhi. 

(Photo: AP)

The Income Tax department has asked its officers to carefully examine the financials of 87,000 persons who made high value deposits at the time of demonetisation, a BloombergQuint report has said.

These people were asked to provide additional information but have not yet responded to the tax department’s questions, an official told BloombergQuint.

According to the official, notices under Section 142 (1) of the Income Tax Act asking for more information about high value deposits were issued to three lakh people who had not filed their I-T returns. This section pertains to inquiries into income prior to assessment.

According to the report, a government official said that 87,000 people of the three lakh made deposits amounting to Rs 2 lakh at the time of demonetisation. BloombergQuint was not able to verify the amount deposited by the 87,000 assessees, either individually or in total.

There was also no response to an emailed query that BloombergQuint had sent to spokesperson of Central Board of Direct Taxes, said the report.

In order to take the assessment forward, the investigation division of the I-T department will be providing details of the 87,000 assesses such as addresses, transaction details and bank account information. The I-T department will then take the assessment forward, after having verified the information about cash deposits. They have also been asked to analyse in detail past income tax returns of the assessees to check the nature of transactions made during the note ban.

In cases where the financial beneficiary of a transaction is identified, the official has been asked to forward the details of the transaction to the official under whose jurisdiction the beneficiary falls. Action will then be initiated against the beneficiary as well.

These assessments are expected to be completed by 31 March or latest by 30 June, 2019, said the report, quoting the first official. Since these cases pertain to the assessment year 2017-18, the proceedings need to be completed by 31 December 2019. But the government wants the proceedings to be completed by latest 30 June in order to expedite closure of these cases and hasten recovery of taxes.

(With inputs from BloombergQuint.)