BE AWARE! The income tax department can Deliver Notice even on your friend’s transaction
Receiving notices from the Income Tax Department is a common occurrence, and sometimes these notices are issued for transactions that you haven't actually made. This can happen to anyone, causing a sense of anxiety. However, there's no need to panic excessively. In a special program called CNBC Awaaz Tax Guru, tax expert Sharad Kohli shared valuable insights on how to address this issue. Let's find out what steps you need to take to resolve the situation.
BE AWARE! The income tax department can Deliver Notice even on your friend’s transaction
Receiving notices from the Income Tax Department is a common occurrence, and sometimes these notices are issued for transactions that you haven't actually made. This can happen to anyone, causing a sense of anxiety. However, there's no need to panic excessively. In a special program called CNBC Awaaz Tax Guru, tax expert Sharad Kohli shared valuable insights on how to address this issue. Let's find out what steps you need to take to resolve the situation.
According to tax expert Sharad Kohli, it is possible to receive a notice even for a transaction carried out by someone else, such as a friend. If your name or any financial connection is associated with the transaction, you may be called in for questioning by the Revenue Department under section 153C.
In such cases, individuals can be summoned as witnesses. Failure to cooperate with the inquiry may result in a penalty of up to ₹10,000. Additionally, under section 133(6), companies or banks may also be subjected to questioning.
Instances have been observed where individuals fraudulently siphon money from someone else's bank account by routing transactions through it. In such cases, the account holder is unaware of these transactions taking place in their account.
Surprisingly, even in such circumstances, one may receive an income tax notice. The tax expert advises that you should provide an explanation to the department and clarify that you are not responsible for these transactions.
Previously, the Income Tax Appellate Tribunal (ITAT) ruled that charging capitation fees based solely on a written notice is incorrect. The Income Tax Department does not impose taxes without substantial evidence to support its claims. This indicates that concrete evidence is required before any tax can be levied.
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Krishna Gopal Varshney
An editor at MyitronlinenewsKrishna Gopal Varshney, Founder & CEO of Myitronline Global Services Private Limited at Delhi. A dedicated and tireless Expert Service Provider for the clients seeking tax filing assistance and all other essential requirements associated with Business/Professional establishment. Connect to us and let us give the Best Support to make you a Success. Visit our website for latest Business News and IT Updates.