IT Department Starts Issuing Notices For Cash Deposits On Or After 09/11/2016

The Prime Minister, Narendra Modi’s has reported demonetisation of old Rs 1,000 and Rs 500 currency on the  8^th of  November 2016 and after that there was lot of ways where people have started trying to convert their Black Money into White and one such way was by using Bank account of others. Government is watching such development closely and to curb this has issued a notification asking banks to report all the cash deposit between 9 Nov to 30 Dec in AIR report on or before 31st January 2017.

Government has also issued a Press Release where it has warned to take Strict Action against the Tax Evaders by using other persons’ Bank Accounts to convert their Black Money into the New Denomination Notes and against the Person(s) who has allowed His Or Her Bank Account to be misused for this purpose can be Prosecuted for the Abetment under the Income Tax Act.

Income Tax notices are being circulating on Whatsapp and on other social media channels regarding the deposit of Cash in the bank account by an Assessee.

For example, The director of Income Tax (Investigation) is asking the depositor to appear before the deputy director on or before the 25^th of November to explain the source of deposits, along with the supporting documentary as an evidence.

Although the notice is been duly issued but the officer has failed to mention that under which section he has issued the notice or called the assessee and details and what lead to his suspicion.

Some people are also discussing the authenticity of the Notice which in the assumption should not have been the case as officer himself has confirmed to a leading newspaper regarding the authenticity of the same that he is not sure about the issuing of the notices for small deposits to the tax payers. Is this the beginning of the Tax Terrorism under the BJP regime or it is the step in the right direction to curb the black money.

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