Operation Clean Money: everybody needs to check their e-filing account-Courtesy Hindustan Times
You need to respond within 10 days
of getting this message from the I-T department. Even if you did not deposit
much money in your account, do check your e-filing account
If you had deposited a large stash of cash
post-demonetization, chances are that you have already got a message from the
income tax department. You need to respond within 10 days of getting the
message. But even if you have not received any message and did not deposit much
money, do check your e-filing account to see if there is bad news ahead for
you.
You could get a compliance notice if your high-value
transactions are not in line with your income profile. You could also get a
notice because of technical errors, where a cash deposit was wrongly attributed
to your Permanent Account Number (PAN). This means that every taxpayer needs to
login and check if there is any message from the tax department.
What should you do
Login into your e-filing account on the income tax
department website https://incometaxindiaefiling.gov.in. Your
username is your PAN number, and keep your password handy. Click the “Cash
Transactions, 2016” option from the drop down list under “Compliance” section.
If there is no cash deposit-related compliance against your profile, it will
show the message: “Presently, you are not required to submit any response. You
may check again later. Please ensure that your email and mobile is updated in
the profile.” However, if you did make deposits that are out of tune with your
past returns, it will reflect the details of transactions related to cash
deposits between 9 November and 30 December 2016. In such a case, you will be
further required to submit responses, which can be done online.
How to submit responses
The response can be submitted in two steps. The first step
is to acknowledge whether the transaction information belongs to you or not.
For each transaction, you can choose: “The account relates to this PAN” or “The
account does not relate to this PAN”.
“There are possibilities that cash deposit transactions were
wrongly credited against your PAN," said Sudhir Kaushik, co-founder and
chief financial officer, Taxspanner.com, an e-filing and tax services portal.
“In the past there have been instances where tax deducted at source (TDS) was
wrongly credited against another PAN; such mistakes could happen in these cases
too. But probability is very low,” he added.
So, if the transaction information does not belong to you,
you can select the option: “The Account does not relate to this PAN.” Upon
doing so, the message will read: “Your feedback will be sent to the information
source for confirmation”. But if the transaction information belongs to you,
you should select the option: “The account relates to this PAN.” After that you
will be directed to the next step where you can respond about the details of
the transaction.
First, you need to confirm that the amount mentioned in the
transaction or deposit is correct. If there is a mismatch in what you deposited
and the amount against which the department is seeking your response, you can
mention the correct amount you had deposited in the bank account.
Explanation of deposit
Once you confirm the amount of money deposited by you in the
bank account, the next step is to give details about the deposited amount. “One
must take utmost care while responding about the source of deposited money,”
said Amit Maheshwari, partner, Ashok Maheshwary & Associates LLP. Based on
the information provided by the individual, the department will take further
necessary action. If the deposited amount in the bank is from more than one
categories (or out of cash in hand), the details of each source and amount from
it needs to be mentioned.
If you claim that the deposited cash was out of earlier
income or savings, you may need to provide additional information, which will
be matched with your income tax returns filed earlier. If this is not in line
with the taxpayer’s profile or other available information, the case may be
selected for verification based on the risk criteria.
If cash is claimed to be out of receipts exempt from tax,
such as agricultural income, gift, and donation, further details need to be
provided such as name and PAN of the person who gifted or donated. In the other
three options you can mention that the cash deposited is received from another
person. Here you have to give a break-up of the: “Cash received from
identifiable persons (with PAN)”, “Cash received from identifiable persons
(without PAN)”, and “Cash received from un-identifiable persons”.
But if someone mentions the source of the cash as received
from another person—whether identifiable or not—it may attract trouble. This is
because the income tax department has warned people against depositing others’ money
in their own account. “It may attract implications of the benami property Act,”
said Maheshwari. “Under the Act, both penalty and prosecution can be initiated
against such persons,” he added. While filing the responses, remember that the
sum of all sources of cash deposits should match the total cash deposited
amount. Besides that, you can also mention that the deposited money is
disclosed or is to be disclosed under Pradhan Mantri Garib Kalyan Yojana.
Even if you have not received any such email or message,
“one should proactively login to the e-filing account and check if there is any
compliance intimation to be addressed,” advised Kaushik. “We are also advising
some of our clients according to their profile, to visit and check their
e-filing accounts,” said Maheshwari.
So, go ahead and check the status even if you made no big
deposits.
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