Income Tax Non Statutory Query Letter

In all the new ITR(Income Tax Return) forms an information about following transaction has been demanded.And what i observe that person are normally ignoring this and leaving this detail blank.

1.Cash deposits aggregating to ten lakh rupees or more in a year in any savings account by you maintained in a banking company to which the Banking Regulation Act, 1949 (10 of 1949),applied (including any bank or banking institution referred to in section 51 of the Act.

2.Payment made by you against bills raised in respect of a credit card aggregating to two lakh rupees or more in a year.

3.Payment made by you of an amount of two lakh rupees or more for purchase of units of Mutual Fund.

4.Payment made by you of an amount of five lakh rupees or more for acquiring bonds or debentures issued by a company or institution.

5.Payment made by you of an amount of one lakh rupees or more for acquiring shares issued by a company.

6.Purchase by you of any immovable property valued at thirty lakh rupees or more.

7.Sale by you of any immovable property valued at thirty lakh rupees or more.

8.Payment made by you of an amount of five lakh rupees or more in a year for investment in bonds issued by Reserve Bank of India.

Now the dept is ready to cross verifying your detail with AIR(Annual Information Return).In all the above transaction some one is responsible to file the AIR and file it to income tax dept. through TIN_NSDL .but it was published some where that in almost 60 % of the entries reported in AIR does not have a PAN.The reason behind that is person doing this transaction are not giving their Pan to the person who are liable to file the return. Though this % is reducing day by day but yet it is a large %.
 

Generally public think that if PAN is not supplied than our transaction can not be traced by the dept. To some extent they are right but not 100 % .In new era of computersiation it is possible to trace transaction without Pan.

A software has been developed by the DIT(systems) to match the transaction without pan in Air.According to tender floated on income tax website there are 8,00,000 transaction without Pan reported in AIR and department has a Pan database of 5 crore.The software will detect two possible Pan for the every transaction without Pan reported in Air on the basis of, Name of the person,address etc,then each suggested pan for a particular transaction by the software will be verify by the person manually on the the basis of other parameters not checked by the software . after the complete verification pan will be assigned to the transaction.in this process in my view dept will have a success almost 60-70 % .

So person who are not reporting information in new ITR by presuming that if pan not given transaction can not be traced ,should reconsider it and should ready themselves according to alertness of income tax dept.

As Mr. A. V. Vishal reports, there are thousands and thousands of cases like yours. They random select a certain percentage of cases and send them notice as they have done in your case now. If you ask whether you are obliged to respond, the answer is yes. But again a large number of cases will not respond. Though the work of the income-tax department has been computerized, if they have to follow up cases like yours it will have to be done manually only. Hence they may not follow up all cases. But if you keep quiet there is a risk that you may get caught. If you have nothing to hide, it is better that you respond.

If you have really done high value transactions without giving your PAN and without filing AIR, but you are able to satisfy the officer concerned that you had enough income to make those transactions and you had tax due on it, there will not be much of a problem. Apart from the way they find out as mentioned by Mr. Vishal, they will get information from the party with whom you would have done the transactions also.

Years ago, when there were no PAN cards and there were no computers or internet, I received notice asking for the source of income for the purchase of a car. I just answered their letter and there ended the matter. They collected the information about me from the dealer.

In USA, even celebrities and those who hold high positions in politics or the Government also get caught and have been even imprisoned. In India we hear of raid on prominent people, but nothing thereafter. I do not know anything about persons like you and me. Even if we get imprisoned, that will be no news for the media to report.

if in the saving account client has deposit aggregating Rs. 10Lac but not in singal entry

E.g if Entry Rs. 2Lac X 5 = 10Lac

which date should be maintioned in AIR Return??

Bcz Software utility not allowed to enter multiple entry less than Rs. 10Lac.

Deepak Goyal 

9878789044

Kumar_deepak444@yahoo.co.in