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Statement of Financial Transactions in Form 61A

Statement of Financial Transactions (previously called Annual Information Return – AIR) is to be filed by specified persons in respect of specified financial transactions in Form no. 61A.

Form 61A can be filed only electronically and with use of digital signature (DSC). Last day of filing statement is 31st May of the succeeding financial years. No statement is required to be furnished if there is no specified transactions. In other words NIL statement is not required to be filed.

Persons who are liable to audit under section 44AB are also required to file statement of financial transactions if they made CASH SALES to a person exceeding rs. 2 lakhs in a financial year. It doesn’t matter whether the cash is received against a single invoice or against multiple invoice.

Income Tax Department Reporting Entity Identification Number (ITDREIN) is required to file form 61A.

Complete guide by department to generate ITDREIN and file form 61A 

Form 61A Java utility can be downloaded from Download >> Forms (other than ITR) section on http://www.incometaxindiaefiling.gov.in/

Penalty can be levied of Rs. 100 per day of default in case of non filing or late filing of form. Penalty, on non-compliance to notice calling for return, @ Rs. 500/- per day and Penalty of Rs. 50,000/- for providing inaccurate information in the statement.

This statement is to be filed by class of persons mentioned in below table for stated transactions.

S No. Nature and value of transaction Class of person (reporting person)
1. (a) Payment made in cash for purchase of bank drafts or pay orders or banker’s cheque of an amount aggregating to ten lakh rupees or more in a financial year.

(b) Payments made in cash aggregating to ten lakh rupees or more during the financial year for purchase of pre-paid instruments issued by Reserve Bank of India under section 18 of the Payment and Settlement Systems Act, 2007 (51 of 2007).

(c) Cash deposits or cash withdrawals (including through bearer’s cheque) aggregating to fifty lakh rupees or more in a financial year, in or from one or more current account of a person.

A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act).
2. Cash deposits aggregating to ten lakh rupees or more in a financial year, in one or more accounts (other than a current account and time deposit) of a person. (i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act);

(ii) Post Master General10 as referred to in clause (j) of section 2 of the Indian Post Office Act, 1898 (6 of 1898).

3. One or more time deposits (other than a time deposit made through renewal of another time deposit) of a person aggregating to ten lakh rupees or more in a financial year of a person. (i) A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act);

(ii) Post Master General as referred to in clause (j) of section 2 of the Indian Post Office Act, 1898 (6 of 1898);

(iii) Nidhi 10 referred to in section 406 of the Companies Act, 2013 (18 of 2013);(iv) Non-banking financial company which holds a certificate of registration under section 45-IA of the Reserve Bank of India Act, 1934 (6 of 1934), to hold or accept deposit from public.

4. Payments made by any person of an amount aggregating to—

(i) one lakh rupees or more in cash; or

(ii) ten lakh rupees or more by any other mode, against bills raised in respect of one or more credit cards issued to that person, in a financial year.

A banking company or a co-operative bank to which the Banking Regulation Act, 1949 (10 of 1949) applies (including any bank or banking institution referred to in section 51 of that Act) or any other company or institution issuing credit card.
5. Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring bonds or debentures issued by the company or institution (other than the amount received on account of renewal of the bond or debenture issued by that company). A company or institution issuing bonds or debentures.
6. Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring shares (including share application money) issued by the company. A company issuing shares.
7. Buy back of shares from any person (other than the shares bought in the open market) for an amount or value aggregating to ten lakh rupees or more in a financial year. A company listed on a recognised stock exchange purchasing its own securities under section 68 of the Companies Act, 2013 (18 of 2013).
8. Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring units of one or more schemes of a Mutual Fund (other than the amount received on account of transfer from one scheme to another scheme of that Mutual Fund). A trustee of a Mutual Fund or such other person managing the affairs of the Mutual Fund as may be duly authorised by the trustee in this behalf.
9. Receipt from any person for sale of foreign currency including any credit of such currency to foreign exchange card or expense in such currency through a debit or credit card or through issue of travellers cheque or draft or any other instrument of an amount aggregating to ten lakh rupees or more during a financial year. Authorised person as referred to in clause (c) of section 2 of the Foreign Exchange Management Act, 1999 (42 of 1999).
10. Purchase or sale by any person of immovable property for an amount of thirty lakh rupees or more or valued by the stamp valuation authority referred to in section 50C of the Act at thirty lakh rupees or more. Inspector-General appointed under section 3 of the Registration Act, 1908 or Registrar or Sub-Registrar appointed under section 6 of that Act.
11. Receipt of cash payment exceeding two lakh rupees for sale, by any person, of goods or services of any nature (other than those specified at Sl. Nos. 1 to 10 of this rule, if any.) Any person who is liable for audit under section 44AB of the Act.

While calculating the threshold limits as per above table

  1. take into account all the accounts of the nature mentioned maintained in respect of that person.
  2. aggregate all the transactions of the same nature in respect of that person.
  3. apply the threshold separately to deposits and withdrawals in respect of transactions covered in point 1 (c).

Therefore if cash sales in made to a person in parts and total cash sales to that person exceeds rs. 2 lakhs, then the seller is liable to file this statement.

Statement of financial transactions is to required to be filed by

(a) an assessee
(b) the prescribed person in the case of an office of Government
(c) a local authority or other public body or association
(d) the Registrar or Sub­ Registrar appointed under section 6 of the Registration Act, 1908 (16 of 1908)
(e) the registering authority empowered to register motor vehicles under Chapter IV of the Motor Vehicles Act, 1988 (59 of 1988)
(f) the Post Master General as referred to in clause
(j) of section 2 of the Indian Post Office Act, 1898 (6 of 1898)
(g) the Collector referred to in clause (c) of section 3 of the Land Acquisition Act, 1894 (1 of 1894)
(h) the recognised stock exchange 63 referred to in clause (f) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956)
(i) an officer of the Reserve Bank of India, constituted under section 3 of the Reserve Bank of India Act, 1934 (2 of 1934)
(j) a depository referred to in clause (e) of sub ­section (1) of section 2 of the Depositories Act, 1996 (22 of 1996) 63

Any defect found by the income tax authority considers the statement as defective, he may intimate the defect to the person and allow to rectify the defect within a period of 30 days. The authority may allow a higher period of time. If the defect is not rectified within 30 days or such extended period then the statement is considered as not filed.

Where a person has not furnished the statement within the specified time, the prescribed income-tax authority may serve upon such person a notice requiring him to furnish such statement within a period not exceeding thirty days from the date of service of such notice and he shall furnish the statement within the time specified in the notice.

If the person finds any inaccuracy in the statement filed, he shall inform the authority within a period of 10 days.

Source – Section 285BA

Rule 114E

 

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