The income tax department is "verifying" over Rs 4.5 lakh crore of suspicious deposits made by 18 lakh people post the government's demonetisation move and will send 'non-statutory' letters to those who have not responded to its SMS and e-mail queries seeking explanation.
Big data analysis by the tax department has revealed that deposits of over Rs 2 lakh totalling Rs 10 lakh crore were made in about one crore bank accounts in the 50-day window after the demonetisation decision that cancelled 86% of currency in circulation.
Of these, it picked up 18 lakh deposits of over Rs 5 lakh each for examination as they prima facie looked suspicious, an official told PTI.
Code-naming the scrutiny 'Operation Clean Money', it sent SMSes and e-mails to these 18 lakh people, asking them to explain the source of the funds by February 15 on the e-filing portal.
So far, it has received replies from over 7 lakh people, most of whom accepted making such deposits and the department will issue letters to the remaining nudging them to explain the source of deposits on the e-filing portal, he said.
"More than 99% of the 7 lakh respondents have accepted that the data are correct," the official said.
As many as 5 lakh people out of these 18 lakh who have been sent SMS and e-mail are not registered in the e-filing portal, he said.
It is only after processing response to the non-statutory letters being sent, can the Income Tax Department look at taking any penal action as not responding to SMS or e-mail communication does not enjoy a legal backing for initiating action.
The official said that of the Rs 10 lakh crore deposits made in 1 crore bank accounts, Rs 4.5 lakh crore have come under the tax department's verification because of their suspicious nature as they appeared not matching with previous income returns filed by the depositors.
The department has alerted the field offices about the data of people who have not responded as well as over 5 lakh who are not registered with the e-filing portal and these have been asked to send the letters.
"So far, over 7 lakh responses had come. The window is still open and people can file replies. Those who have not replied will now be getting letters from the tax department," the official said.
The official further said the tax department wants to avoid harassment to taxpayers and hence, has asked the field offices to send non-statutory letters to the people who have not filed reply.
"Only in certain cases where we have full evidence of an assessee trying to evade the tax net, we will visit there physically and conduct surveys," the official said.