Don’t forget to disclose cash deposit in income tax return

Information on cash deposited in bank accounts from 09.11.2016 to 30.12.2016 to be disclosed income tax return for the Assessment Year 2017- 2018

Income tax department has started sending email communication for those who have already submitted the online response to the notice received for cash deposit made during the demonstration period, requesting them to disclose the same in income tax return.

Further, The Income Tax Department (ITD) has used information received under the Statement of Financial Transactions (SFT) to identify 5.56 lakh new persons in the second phase of “Operation Clean Money” (OCM) and send them email communication. (ITD) intends to leverage technology and data analytics for effective utilization of demonetization data i.e. transactions related to cash deposits during 9th Nov to 30th Dec 2016. Therefore online verification has been enabled on e-filing portal (for taxpayers) which will be synchronized with the internal verification portal of ITD. Email and SMS are being sent to the taxpayers informing that information has been received in the case and response may be submitted on the e-filing portal

One such email communication is reproduced below.

Information on Cash Transactions identified in the 2nd phase of Operation Clean Money – ADXXXXXXXQ
Income-tax Department (ITD) has identified X accounts showing total cash deposits of Rs. xxxxxxx relating to you in the 2nd phase of Operation Clean Money.

ITD has enabled online verification of the cash transactions and there is no need to visit Income tax office for submission of response. The information in respect of these cases has been made available in the e-filing portal. Please submit your response by following the below steps.

Step 1: Login to e-filing portal at
Step 2: Click on “Cash Transactions, 2016″ link under “Compliance” section.
Step 3: The details of transactions related to cash deposits during 9th Nov to 30th Dec 2016 will be displayed
Step 4: Submit your online response for each transaction.

• For “Quick Reference Guide for Online Verification of Cash Deposits” click here.
• For detailed “User Guide on Online Verification of Cash Deposits” click here.
• Visit for latest updates on Operation Clean Money.
Kindly submit your response within 10 days of this email.

• Details of cash deposited in bank accounts aggregating to 2 lakh or more is required to be given in the Income Tax Return (ITR).
• This information will be matched with the information in possession of the Income tax Department.
• The taxpayer should ensure that ITR is compliant with amount deposited in bank accounts during the period of demonetization and while computing income, the amounts so deposited are considered/ taken into account while paying taxes.
• Cash deposits made in the above period may thus be fully and truly disclosed in the income tax return (ITR).
In cases where the response is not received from taxpayers within the reasonable time, other proceedings and enforcement actions shall be considered by the department.
Source : simplifiedlaws