I-T department begins action on firms failing to report high-value deals
New Delhi, Oct 17, 2025
The Income Tax Department has started issuing notices and levying penalties on these non-compliant entities, directing field officers to complete the process by end-November
The Income Tax Department has started a nationwide drive to identify and penalise reporting entities that failed to file Statements of Financial Transactions (SFT) and Significant Financial Transactions (SRA) for financial years 2023-24 and 2024-25, The Economic Times reported. These reports capture details of high-value transactions required under the law.
Officials said the Directorate of Systems had flagged many such entities that either failed to file reports or submitted incomplete information. The list was circulated to field formations by September 30.
The department has begun issuing notices and imposing penalties on these non-compliant entities, instructing field officers to complete the process by the end of November.
“The department has recommended hefty penalty applicable under the law, and the process has to be completed by the end of November,” a senior official was quoted as saying.
Transactions that went unreported include cash deposits, vehicle purchases in the names of minor children, gold purchases, and luxury hotel stays with bills exceeding ₹50,000. The SFT serves as a reporting mechanism requiring specified entities to furnish details of high-value transactions, including both cash and digital payments, as well as interest and dividend incomes.
CBDT uses AI tools to enhance tax compliance
The Income Tax Department has started using artificial intelligence (AI) to monitor taxpayer behaviour. The system tracks visits to the income tax portal, flags high-value transactions, and detects Permanent Account Numbers (PANs) linked to suspicious claims.
Central Board of Direct Taxes (CBDT) Chairman Ravi Agrawal clarified that the department’s access to digital records is strictly limited to search and seizure cases where taxpayers decline to share data voluntarily.
New ITR portal feature
The department has also introduced a new functionality on its e-filing portal that enables taxpayers to view the exact date and time when an Assessing Officer (AO) or Commissioner of Income Tax (Appeals) accesses their submissions. This measure will enhance transparency, minimise disputes, and strengthen confidence in the faceless assessment system.
Due date for ITR filing extended
In May, the department extended the due date for filing income tax returns (ITRs) for Assessment Year (AY) 2025-26, covering income earned in financial year 2024-25, for individuals, Hindu Undivided Families (HUFs), and entities not subject to audit. The deadline was moved from July 31 to September 15. The extension followed “structural and content revisions” in ITR forms notified in late April and early May.
[The Business Standard]
