Many individuals and corporate have started receiving emails to file Statement of Financial transactions (SFT) by all reporting persons covered under Rule 114E of Income-tax Rules, 1962. Due date for filing the same in Form 61A is 31st May 2017, The Article give you detail of its applicability, transaction and entity covered, exemption and monetary limit

Following are summary of person responsible and nature of transaction            

Class of person (reporting person)

Nature and value of transaction    

Person who is liable for audit under section 44AB of the Income Tax Act

Receipt of cash payment exceeding two lakh rupees for sale of goods or service

A company

Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring shares Bonds or Debentures

A trustee of a Mutual Fund

Receipt from any person of an amount aggregating to ten lakh rupees or more in a financial year for acquiring units 

A banking company or a co-operative bank or NBFC or NidhiCompnay

Bank drafts or pay orders Payments made in cash aggregating to ten lakh rupees. Or Cash deposits aggregating to ten lakh rupees or more in a financial year, in one or more accounts or Time deposit or Cash deposits or cash withdrawals (including through bearer's cheque) aggregating to fifty lakh rupees 

Authorised person referred to Foreign Exchange Management Act, 1999

Receipt from any person for sale of foreign currency of an amount aggregating to ten lakh rupees or more

banking company or a co-operative bank or Post Master General

Cash deposits during the period 09th November, 2016 to 30th December, 2016 aggregating to—

twelve lakh fifty thousand rupees in current account

two lakh fifty thousand rupees in other account

Which person and individual are covered?

Obligation to furnish statement of financial transaction or reportable account.285BA. (1) Any person, being—

 (a) anassessee; or

 (b) the prescribed person in the case of an office of Government; or

 (c) a local authority or other public body or association; or

 (d) the Registrar or Sub-Registrar appointed under section 6 of the Registration Act, 1908 (16 of 1908); or

 (e) the registering authority empowered to register motor vehicles under Chapter IV of the Motor Vehicles Act, 1988 (59 of 1988) ; or

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

 (g) the Collector referred to in clause (g) of section 3 of the Right to Fair Compensation and Transparency in Land Acquisition, Rehabilitation and Resettlement Act, 2013 (30 of 2013) ; or

 (h) the recognised stock exchange referred to in clause (f) of section 2 of the Securities Contracts (Regulation) Act, 1956 (42 of 1956) ; or

  (i) an officer of the Reserve Bank of India, constituted under section 3 of the Reserve Bank of India Act, 1934 (2 of 1934); or

  (j) a depository referred to in clause (e) of sub-section (1) of section 2 of the Depositories Act, 1996 (22 of 1996) ; or

 (k) a prescribed reporting financial institution16,

who is responsible for registering, or, maintaining books of account or other document containing a record of any specified financial transaction or any reportable account as may be prescribed, under any law for the time being in force, shall furnish a statement in respect of such specified financial transaction or such reportable account which is registered or recorded or maintained by him and information relating to which is relevant and required for the purposes of this Act, to the income-tax authority or such other authority or agency as may be prescribed.

Nature of Transaction covered

 (a) transaction of purchase, sale or exchange of goods or property or right or interest in a property; or

 (b) transaction for rendering any service; or

 (c) transaction under a works contract; or

 (d) transaction by way of an investment made or an expenditure incurred; or

 (e) transaction for taking or accepting any loan or deposit,

What if statement is not filed by 31 May 2017

Where a person who is required to furnish a statement under sub-section (1) has not furnished the same 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.

What Rule 114E says

114E. (1) The statement of financial transaction required to be furnished under sub-section (1) of section 285BA of the Act shall be furnished in respect of a financial year in Form No. 61A and shall be verified in the manner indicated therein.

(2) The statement referred to in sub-rule (1) shall be furnished by every person mentioned in column (3) of the Table below in respect of all the transactions of the nature and value specified in the corresponding entry in column (2) of the said Table in accordance with the provisions of sub-rule (3), which are registered or recorded by him on or after the 1st day of April, 2016, namely:—

TABLE

Sl. No.

Nature and value of transaction

Class of person (reporting person)

(1)

(2)

(3)

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) Nidhi10 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 travellerscheque or draft or any other instrument of an amount aggregating to ten lakh rupees or more during a financial year.

Authorised person 11 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.

9aa[12.

Cash deposits during the period 09th November, 2016 to 30th December, 2016 aggregating to—

(i)

 

twelve lakh fifty thousand rupees or more, in one or more current account of a person; or

(ii)

 

two lakh fifty thousand rupees or more, in one or more accounts (other than a current account) 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).]

9ab[13.

Cash deposits during the period 1st of April, 2016 to 9th November, 2016 in respect of accounts that are reportable under Sl.No.12.

(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).]

(3) The reporting person mentioned in column (3) of the Table under sub-rule (2) 11a[(other than the persons at Sl.No.10 and Sl.No.11)] shall, while aggregating the amounts for determining the threshold amount for reporting in respect of any person as specified in column (2) of the said Table,—

(a)

 

take into account all the accounts of the same nature as specified in column (2) of the said Table maintained in respect of that person during the financial year;

(b)

 

aggregate all the transactions of the same nature as specified in column (2) of the said Table recorded in respect of that person during the financial year;

(c)

 

attribute the entire value of the transaction or the aggregated value of all the transactions to all the persons, in a case where the account is maintained or transaction is recorded in the name of more than one person;

(d)

 

apply the threshold limit separately to deposits and withdrawals in respect of transaction specified in item (c) under column (2), against Sl. No. 1 of the said Table.

(4)(a) The return in Form No. 61A referred to in sub-rule (1) shall be furnished to the Director of Income-tax (Intelligence and Criminal Investigation) or the Joint Director of Income-tax (Intelligence and Criminal Investigation) through online transmission of electronic data to a server designated for this purpose under the digital signature of the person specified in sub-rule (7) and in accordance with the data structure specified in this regard by the Principal Director General of Income-tax (Systems):

Provided that in case of a reporting person, being a Post Master General or a Registrar or an Inspector General referred to in sub-rule (2), the said return in Form 61A may be furnished in a computer readable media, being a Compact Disc or Digital Video Disc (DVD), alongwith the verification in Form-V on paper.

Explanation.—For the purposes of this sub-rule, "digital signature" means a digital signature issued by any Certifying Authority authorised to issue such certificates by the Controller of Certifying Authorities.

(b) Principal Director General of Income-tax (Systems) shall specify the procedures, data structures and standards for ensuring secure capture and transmission of data, evolving and implementing appropriate security, archival and retrieval policies.

(c) The Board may designate an officer as Information Statement Administrator, not below the rank of a Joint Director of Income-tax for the purposes of day to day administration in relation to the furnishing of returns or statements.

(5) The statement of financial transactions referred to in sub-rule (1) shall be furnished on or before the 31st May, immediately following the financial year in which the transaction is registered or recorded:

9ac [Provided the statement of financial transaction in respect of the transactions listed at serial number (12) 9ad[and serial number (13)] in the Table under sub-rule (2), shall be furnished on or before the 31st day of January, 2017.]

(6) (a) Every reporting person mentioned in column (3) of the Table under sub-rule (2) shall communicate to the Principal Director General of Income-tax (Systems) the name, designation, address and telephone number of the Designated Director and the Principal Officer and obtain a registration number.

(b) It shall be the duty of every person specified in column (3) of the Table under sub-rule (2), its Designated Director, Principal Officer and employees to observe the procedure and the manner of maintaining information as specified by its regulator and ensure compliance with the obligations imposed under section 285BA of the Act and rules 114B to 114D and this rule.

Explanation 1.—"Designated Director" means a person designated by the reporting person to ensure overall compliance with the obligations imposed under section 285BA of the Act and the rules 114B to 114D and this rule and includes—

(i)

 

the Managing Director or a whole-time Director, as defined 11aa in the Companies Act, 2013 (18 of 2013), duly authorised by the Board of Directors if the reporting person is a company;

(ii)

 

the managing partner if the reporting person is a partnership firm;

(iii)

 

the proprietor if the reporting person is a proprietorship concern;

(iv)

 

the managing trustee if the reporting person is a trust;

(v)

 

a person or individual, as the case may be, who controls and manages the affairs of the reporting entity if the reporting person is, an unincorporated association or, a body of individuals or, any other person.

Explanation 2.—"Principal Officer" means an officer designated by the reporting person referred to in the Table in sub-rule (2).

Explanation 3.—"Regulator" means a person or an authority or a Government which is vested with the power to license, authorise, register, regulate or supervise the activity of the reporting person referred to in the Table in sub-rule (2).

(7) The statement of financial transaction referred to in sub-rule (1) shall be signed, verified and furnished by the Designated Director specified in sub-rule (6):

Provided that where the reporting person is a non-resident, the statement may be signed, verified and furnished by a person who holds a valid power of attorney from such Designated Director. 

If you like my article, please share this on :


Search Professional Post Query Post Assignment Read More Articles

In case of business query on above subject, comment here or contact CA Chirag Chauhan




article author

CA Chirag Chauhan

Tax Expert
Chartered Accountant, CA Chauhan



CHECKOUT TRENDING ARTICLES


  • How to Pay Zero Tax for Income up to Rs 12 Lakhs from Salary for Financial Year 2016-17

  • Do not wait till 31st July to file your Income Tax Return – Keep Ready 9 documents to file before due date

  • Missed to Submit HRA declaration to Employer? You can claim HRA at the time of Filing Returns and get Refund from Income Tax

  • Features and Step wise process - Income Declaration Scheme 2016 – Convert your Black Money to White

  • How to Pay Zero Tax for Business Receipts -Turnover of Rs 1 Crore

  • How to Pay Zero Tax for Professionals (CA, CS, Lawyers, Doctors, etc) earning Income of Rs 16 Lakhs

  • Why you should file Income Tax Return? Benefits of Filing Income Tax Returns

  • How to save Rs 10 crore as retirement corpus

  • Having Turnover of Less than 10 Lakhs? How to File NIL Service Tax return with Circular No 033/2012

  • Starting a New Business or Profession? Compare Structure and type of Entity– Sole, Partnership, LLP or Company

  • Revised and Latest TDS Tax Deducted at Source Rate Chart for FY 2016-17 AY 2017-18

  • Exemption for Capital Gain Arising on Transfer of Resident House Property

  • WILL- Important points, Tax Advantages of will and Format of WILL

  • Revised and Latest TDS Tax Deducted at Source Rate Chart for FY 2016-17 AY 2017-18

  • Exemption for Capital Gain Arising on Transfer of Resident House Property

  • WILL- Important points, Tax Advantages of will and Format of WILL

  • Senior Citizens Tax Benefits in Income Tax Act - Filing, exemptions, advance tax and other benefits

  • Registration process for Trade Mark


  • GET FREE ARTICLE UPDATES VIA EMAIL

    Always stay updated with latest information on expertmile

    I hope by reading this article you got enlighten on ,Are you required to file Statement of Financial transactions - Form 61A filing under Section 285BA Rule 114E?further to mention before taken any financial decision based on this content it is prefered to take an expert opinion as matter can be subjective.