Income Tax: Operation Clean Money to verify 18 lakh large cash deposits made after demonetisation

The Income Tax Department (ITD) on Tuesday, January 31, initiated Operation Clean Money that involves e-verification of large cash deposits made between November 9, 2016, and December 30, 2016.

Data analytics is being used for comparing the demonetisation data with information in ITD databases. In the first batch, around 18 lakh transactions have been identified as cash deposits do not appear to be in line with the tax payer's profile.

The ITD has also enabled online verification of these transactions to reduce compliance cost for the taxpayers while optimising its resources. The information in respect of these cases is being made available on the e-filing website of the department -- https://incometaxindiaefiling.gov.in.

People can view information using the link "Cash Transactions 2016" under "Compliance" section of the portal. The taxpayer will also be able to submit online explanation without any need to visit IT office. Email and SMS will also be sent to the taxpayers for submitting online response on the e-filing portal.

Taxpayers who are not yet registered on the e-filing portal (at https://incometaxindiaefiling.gov.in) should register by clicking on the 'Register Yourself' link. Registered taxpayers should verify and update their email address and mobile number on the e-filing portal to receive electronic communication.

Data analytics will be used to select cases for verification, based on approved risk criteria. If the case is selected for verification, request for additional information and its response will also be communicated electronically.

The response of the taxpayer will be assessed against available information. If the explanation of source of cash is found justified, the verification will be closed without any need to visit IT office. The verification will also be closed if the cash deposit is declared under Pradhan Mantri Garib Kalyan Yojna (PMGKY).

The taxpayers covered in this phase must submit their response on the portal within 10 days in order to avoid any notice from the ITD and enforcement actions under the Income Tax Act and other laws.