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Income Tax Dept to assess 87,000 suspicious cases

New Delhi: The Income Tax Department has launched the final assessment of 87,000 cases in the country for making suspicious deposits post-demonetisation, as the taxman has been authorised to exercise the “best judgement” protocol stipulated under Section 144 of the I-T Act, the CBDT has said.

On March 5, the Central Board of Direct taxes (CBDT) issued a standard operating procedure (SOP) and in this regard the tax department has been asked to conclude the exercise by the end of the current financial year in March, but not exceeding “in any case” by June 30.


While issuing the SOP, the CBDT said, while the taxman initially sent notices (under Section 142(1) that pertains to inquiry before assessment) in 3 lakh cases, 87,000 out of these have “not filed their return of income” for assessment year 2017-18. It has also asked the assessing officers (AOs) to use the “best judgement assessment” procedure as stipulated under Section 144 of the I-T Act to finalise these cases.

According to the above section: “If any person fails to comply with all the terms of notice issued under Section 142(1), the AO after taking into account all relevant material which the AO has gathered, shall after giving the assessee an opportunity of being heard, make the assessment of total income or loss to the best of his judgement…”

The CBDT, on its part, assured the AOs that its technical and data mining arm will provide them with the addresses, bank accounts and transaction details of these 87,000 individuals and entities who had made “substantial cash deposits during the demonetisation period”.

Sources in the I-T department said, the cases in hand are those pertaining to suspicious deposits of huge amounts or amounts not in conformity with the transaction history of the entity, post the demonetisation.

The CBDT directive said the AO should also make a “detailed analysis of past income tax returns, if available, to form an opinion regarding nature of transactions related to demonetisation” while framing the assessment of these entities.