Banks to report deposits of Rs 10 lakh to IT dept, depositors will have to disclose source

Banks to report deposits of Rs 10 lakh to IT dept, depositors will have to disclose source
Representational Image. Courtesy: REUTERS/Jayanta Dey

In a bid to flush out black money, the Income Tax department has asked banks to report deposits of over Rs 10 lakh in a year and cash payments of Rs 1 lakh or more on credit card bills.

The Central Board of Direct Taxes (CBDT), in a January 17 notification, listed cash transactions that need to be reported to tax authorities.

It even setup an e-platform that can be used to reach out to those who have made deposits over the threshold limit. The same platform will have to be used by depositors to file their response, about the source of income, online.

According to an ET report, the income department has discovered about 1.5 lakh bank accounts in which Rs 10 lakh or above has been deposited since November 8. There have also been suspicious deposits in one crore accounts belonging to 75 lakh people.

Over the last two months, over a thousand cases of search and seizure carried out by the tax department have yielded around Rs 600 crore, of which Rs 150 crore is in the form of new notes.

In November 2016, the CBDT had also instructed banks to report all cash deposits of Rs 2.5 lakh or more made in one or more accounts of a person during November 9 to December 30, 2016.

Following the demonetisation of old 500 and 1,000 rupee notes, the government had allowed the defunct currency to be deposited in bank accounts during a 50-day window ending December 30, 2016.

“Cash deposits during the period November 9, 2016 to December 30, 2016 aggregating to Rs 12.50 lakh or more in one or more current account of a person (and) Rs 2.5 lakh or more in one or more account (other than a current account) of a person” will have to be reported to tax authorities, it said.

The CBDT also made it mandatory for a banking company or a cooperative bank to report cash deposits aggregating to Rs 10 lakh or more in a financial year, in one or more accounts (other than a current account and time deposit) of a person.

Payments of an amount aggregating to Rs one lakh or more in cash, along with payments of Rs 10 lakh or more made by any mode (including cheque or wire transfer), towards settling credit card dues in a year will also have to reported.

Purchase of foreign exchange including travellers cheque and a forex card aggregating to Rs 10 lakh or more would need to be reported. Even the property registrar will have to report purchase or sale by any person of immovable property for an amount of Rs 30 lakh or more to tax authorities.

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