The Operation Clean Money Initiative was launched by the Income Tax Department(CBDT) for e-verification of large cash deposits made during the period from 9th November to 30th December, 2016. The operation is primarily aimed to verify cash transaction status (exchange /savings of banned notes) of tax payers during the demonetisation period.

If you have deposited high value cash in your account, time has come to verify your transaction. The information in regards of cash deposit has been made available on income tax e-filing portal. The IT department commenced Operation Clean Money to examine the source of all cash deposits to check if they were from legally declared income. The IT department has data related to 10.9 million accounts where deposits ranging from Rs.2 lakhs to 80 lakhs were made in the period between 10th November to 30th December. The Income tax department has sent notices to 1.8 million tax payers who have made cash deposits of more than Rs.5lakhs that are not in connection with their income tax returns.

The taxpayer will be able to submit online explanation without any need to visit income tax office. A detailed user guide and quick reference guide is available on the portal to assist the taxpayer in submitting online response. Registered taxpayers should verify and update their email address and mobile number on the e-filing portal to receive electronic communication.

Data analytics used to select cases for verification based on approved risk criteria. If the case is selected for verification , request for additional information and its response will also be communicated electronically. The information on the online portal will be dynamic getting updated on receipt of new information, response and data analytics.

In case explanation of source of cash is found justified, the verification will be closed without any need to visit Income Tax Office. The verification will also be closed if the cash deposit is declared under Pradhan Mantri Garib Kalyan Yojna.

Assesses may be requested to furnish their PAN if they already have one, or apply instantly PAN to NSDL or UTIISL if they do not have one. They will also be essential to explain the source of the high value investments or deposits/expenditure. Persons who have not appropriately accounted for the high value transactions are compulsory to pay due taxes and file the income tax return within this financial year. For not paying proper taxes there can be penalty levied up to 300% of the unpaid tax. In some case, the tax officials may also visit the premises of the high value investors or depositors or spenders.