With an estimated Rs 15 lakh crore back in the banking system post demonetisation, the income tax department is in talks with leading global tax consultants, including EY, KPMG and PricewaterhouseCoopers, for forensic audit of the data to see if any of it is laundered money.
Following the note ban, as many as 60 lakh individuals and firms made large deposits totalling a staggering Rs 7 lakh crore in old notes. Also, with about Rs 4 lakh crore being deposited by individuals, the I-T department has raised quite a few red flags.
The tax department is already armed with information about suspicious transactions from the Financial Intelligence Unit (FIU) about how much deposits have been made in dormant and Jan Dhan accounts and urban cooperative banks.
The tax department also has data on repayment of loans in cash, RTGS transfer and withdrawal, post cash recall.
“With the help of professional agencies, a thorough analysis of all deposits that came till December 30 will be done to try and join all the dots,” an official said.
The tax department has started talks with the forensic teams of international audit firms and is finalising the details of suspicious transactions that are to be looked into.
Forensic audit constitutes an evaluation of financial information so that the evidence collected can be used against the suspected individual or entity as an evidence in court.
As per the data with the I-T department, deposits in Jan Dhan accounts have more than doubled to Rs 87,000 crore in 45 days following demonetisation. Also, it has information on small cash deposits of Rs 30,000-50,000 made in 4.86 lakh accounts totaling Rs 2,000 crore.
Between November 10 and December 23, as much as Rs 41,523 crore have been deposited in 48 lakh Jan Dhan accounts.
“The tax department is armed with systems to track those with multiple bank accounts as well as those who are depositing in accounts of others and the tax department will not leave anyone who is trying to evade taxes,” the official warned.
Prime Minister Narendra Modi had on November 8 announced junking of old Rs 500 and Rs 1,000 notes and replaced the currency with new Rs 2,000 and Rs 500 notes. People had been queuing up before banks to deposit the defunct currency in the 50-day window till December 30.
The scrapped notes accounted for 86 per cent of the total currency in circulation before demonetisation.