The Income Tax Department has commenced taking actions against unidentified /nameless property and black money. The Department has issued notices to 2000 people who have made cash transactions of more than Rs. 5 lakhs in the purchase of properties. The investigation on cash transactions of more than 20 thousand is also on the verge to begin.
The notice to provide the source of wealth has been issued to those who have purchased the property between June 2015 and December 2018.
Investigation will Continue to Sustain
In a conversation with an official of the Income Tax department, it came on the surface that investigation will not limit on cash transaction worth rupees 5 lakh or above but will continue to sustain on those who have made cash transaction of less than 5 lakh in the purchase of a property. The notice will soon be dispatched to those involved in cash transactions of within 5 lakhs value once these 2000 cases are taken care of. According to the official, the notices are being sent to both the buyer and the seller.
Cash Transactions Exceeding Rupees 20 Thousand are on Hold
The amendments were made in section 269SS of the Income Tax Act to curb black money, in the year 2015. According to the Central Board of Direct Taxes (CBDT), this amendment defines transactions of more than 20 thousand rupees in the purchase and sale of any kind of property, as illegal.
Income tax department will soon initiate the investigations on these transactions as well. For now, these transactions are on hold.
Provision of Penalty Equivalent to the Transaction Amount
According to CBDT, amendments introduced in the section 269SS of Income Tax ACT, after the 1st June 2015, binds the cash transactions of purchase/sale of property exceeding Rs 20,000 with the penalty of an equal amount under section 271D.
Read Also: Penalty Provisions If Not File Income Tax Returns
That means Section 271D imposes a penalty of the same amount as the value of the property for the transactions which are defined as illegal as per the altered section of 269SS of income tax act.