Verification check list for assistance of AOs for OCM cases and framing of assessment in demonetisation related cases - Income Tax - F. No. 225/145/2019-ITA-II

F. No. 225/145/2019-ITA-II Government of India Ministry of Finance Department of Revenue Central Board of Direct Tax North Block, New Delhi, Dated, The 9th August , 2019 To All Principal Chief-Commissioners of Income-Tax/ All Principal Director Generals of Income-Tax Sir/Madam, Subject: - Verification check list for assistance of AOs for OCM cases and framing of assessment in demonetisation related cases-reg Reference:- 1. Instruction No. 3/2017 dated 21.02.2017 issued vide F.No. 225/100/2017/ITA-II. 2. Instruction No. 4/2017 dated 03.03.2017 issued vide F.No. 225/100/2017/ITA-II. 3. SOP dated 15.11.2018 issued vide F.No. 225/363/2017/ITA-II. 4. SOP dated 03.03.2019 issued vide F.No. 225/363/2017/ITA-II. 5. Internal Guidance Note dated 13.06.2019 issued vide F. No. 225/145/2019/ITA-II. Kindly refer to the above 2. In this regard, I am directed to state that the Board has earlier issued above referred SOPs/Instruction/Internal Guidance Note regarding handling of cases related to demonetisation. In continuation of the same, a Verification Checklist-cash deposits is enclosed herewith for providing assistance to AOs for verification of cash deposits and framing of assessment in demonetisation related cases. 3. This checklist-cash deposits may be filled up in all the cases and uploaded in system in the suitable format (to be prescribed by system directorate) so that the deviant cases can be taken up for further study. Yours faithfully, (Rajarajeswari R) Under Secretary (ITA.II), CBDT. mail Id: [email protected] Fax No: 23095489 Encl: As above. Verification checklist Cash Deposit General # Particulars Response Remarks 1.1 Feedback on correctness of information Information was correct Information was partly correct Information was wrong Select Response 1.2 Cash Deposit between 9 th Nov to 31 st Dec 2016 If taxpayer disputes the amount, mention correct amount after verification from bank 1.3 Taxpayer Type Non-Business Case Business Case Select Response Non-Business case # Particulars Response Remarks 2.1 Return filing Compliance First time return filer Return filed first time one year before Return filed first time two years before Returns filed for last 3 year None of the above 2.2 Total Income of the taxpayer in FY 2016-17 2.3 Gross Total Income (including exempt income) of the taxpayer in FY 2016-17 2.4 % of Cash Deposit to Gross Total Income (including exempt income) Value = (1.2/2.3) 2.5 Nature of Deposit Out of loan received Out of repayment of loan Gift Sale or advance for sale of land or any other ca capiital asset Cash received for services rendered Other exempt income Cash in hand Any other 2.6 Assessment of explanation provided by the taxpayer Explanation was acceptable Explanation was partially acceptable Explanation was not acceptable Select Response 2.7 Quantum of Unaccounted Deposits as determined by the AO. Business Case # Particulars Response Remarks 3.1 Regularity of Business First time business return filer Return filed first time one year before Return filed first time two years before Business Returns filed for last 3 year None of the above Select Response 3.2 Nature of Business Select from standard list of Nature of Business Overall Assessment 3.3 Whether Cash Deposits appear in line with earlier Sales Profile Very High High In line Low Very Low Select Response 3.4 Result of Evaluation of Stock Register Stock register is not maintained Stock register is maintained in adhoc manner Stock register is integral part of accounting software Select Response 3.5 Result of Evaluation of Internal Controls Books of account are not maintained It is possible to back date transactions It is not possible to back date transactions Select Response 3.6 Result of Evaluation of books of account and Internal Controls Books of account are properly maintained Books of account are being rejected Select Response 3.7 Quantum of Unaccounted Deposits as determined by the AO 4. Cash Deposits in Bank 4.1. (a) Total cash deposit in Bank in F.Y. 2015-16 (b) Total cash deposit in Bank from 01.04.2015 to 08.11.2015 (c) Total cash deposit in Bank from 09.11.2015 to 31.12.2015 4.2. (a) Total cash deposit in Bank in F.Y. 2016-17 (b) Total cash deposit in Bank from 01.04.2016 to 08.11.2016 (c) Total cash deposit in Bark from 09.11.2016 to 31.12.2016 4.3. (a) Percentage increase between 4.2 (a) and 4.1 (a) (b) Percentage increase between 4.2 (b) and 4.1 (b) (c) Percentage increase between 4.2 (c) and 4.1 (c) 5. Cash Sales 5.1 (a) Total cash sales in F.Y. 2015-2016 (b) Total cash sales from 01.04.2015 to 08.11.2015 5.2 (a) Total cash sales in F.Y. 2016-2017 (b) Total cash sales from 01.04.2016 to 08.11.2016 5.3 (a) Percentage increase between 5.2 (a) and 5.1 (a) (b) Percentage increase between 5.2 (b) and 5.1 (b) 6. Analysis of month wise cash sales and cash deposits from 01.04.2015 to 08.11.2015 Month wise Op. cash in hand Cash sales Cash deposited in Bank Cash withdrawal from the bank Closing cash on hand April, 2015 May, 2015 June, 2015 July, 2015 August, 2015 September, 2015 October, 2015 November till 08.11.2015 7. Analysis of month wise cash sales and cash deposits from 01.04.2016 to 08.11.2016 Month wise Op. cash in hand Cash sales Cash deposited in Bank Cash withdrawal from the bank Closing cash on hand April, 2016 May, 2016 June, 2016 July, 2016 August, 2016 September, 2016 October, 2016 November till 08.11.2016 S.No. Further verification Remarks Yes No 8 Whether reason for mounting cash in hand in F.Y. 2016-2017 till 08.11.2016 has been obtained 9 Whether small part of the cash is deposited in or withdrawn from the Bank despite having huge cash in hand. 10 Whether the quarterly VAT Return is revised in the post-demonetisation period. 11 Whether the reason for the revision has been obtained. 12 Whether there are large changes in the purchase and sales figures between the original and the revised VAT returns. 13 Whether the changes are for genuine reasons. Assessment Procedure S. No. Further verification Remarks Yes No 14 Whether the books of accounts have been rejected 15 Whether the additions have been made u/s 68 to 69D. please mention the section. 16 Whether tax is calculated as per section 115BBE 17 Whether penalty u/s 271AAC has been levied