The Income Tax department has issued hundreds of notices seeking “source” of funds from individuals and firms who have deposited huge amounts of cash in banks using the scrapped Rs 500 and Rs 1000 currency notes after November 8. The taxman has begun a nationwide enquiry and has issued notices under Section 133 (6) of the Income Tax Act (power to call for information) in various cities and towns of the country. They said the notices were issued after banks reported to it certain cases of “unusual or suspicious volumes of cash deposits” in their accounts, primarily beyond Rs 2.5 lakh.
“The notices are being issued where the department feels the cash deposits made in the demonetised currency is suspect. This is part of the vigil that the taxman has deployed to check instances of tax evasion, money laundering and black money in the wake of the demonetisation of the two high denomination currencies on November 8,” they said.
The notices issued by the department cite the date and amount deposited by an entity in the old currency in the bank as it goes on to seek “supporting documents, books of accounts and bills to explain the said cash deposits” from them. “If you are assessed to Income Tax, then you shall also file the copy of Income Tax Return of last two years,” an I-T department said.
The department has also stepped up its survey operations against real estate players, bullion traders and suspected hawala operatives.