Nowadays many people getting notices from the Income Tax Department regarding cash deposit or cash withdrawal limit in saving or current accounts. So today we will discuss the above issue.
The Income Tax Department directly has not issued any specified limit but they are taking indirect control. Any person who wants to do a cash deposit will go to the bank. Now the bank will the same report to the income tax department if the specified limit is crossed.
Now the question is how the bank will report to the income tax department regarding this. The department has issued the guidelines in the form of a Statement of Financial Transactions (SFT). For e.g in this guideline if Mr. Ram has crossed the limit as specified then the bank will report in the SFT.
How to Avoid Notices in the Income Tax under Section 148:
If the cash deposit or withdrawal is reflected in the ITR then there are very less chances that you will receive notice under this section. But if it is not reflected in ITR then at the end of the assessment year.
So it is better to do fewer transactions in cash and if possible do it in two or three financial year.
Cash Deposit or Cash Withdrawal Limit:
[Furnishing of statement of financial transaction.
|Sl. No.||Nature and value of transaction||Class of person (reporting person)|
|1.||(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).|
So from the above table, it is clear that:
Saving Account cash deposit limit is (one or more means aggregate in Financial Year) Rs. 10 lakhs or more.
Current Account cash deposit limit is (one or more means aggregate in Financial Year) Rs. 10 lakhs or more.
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