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The recently launched Operation Clean Money has received ample response from taxpayers through the e-filing window. However, an error occurred in the 18 lakh communications sent by the Income Tax (IT) department for cash deposits made post-demonetisation (November 8). The Indian Express reports that banks and financial institutions have submitted data for cash deposits made between November 9-December 30 to the tax department. Some of them have also provided data for cash deposits on November 8 also, resulting in wrong communication being sent to some of the 18 lakh individuals.

Post the compilation of the responses received under the first 10-day window, the second phase of the Operation Clean Money will commence soon. The first phase of compilation of cash deposits included data analysis post-demonetisation. The upcoming phases will also include financial transactions like sale of gold by jewellers, that will be matched with their respective tax returns.

In an interview to The Indian Express last week, Hasmukh Adhia, revenue secretary told that the data analysis and financial transactions will be undertaken in phases over the next two years. He said, “Whatever exercise we do and this is only the first phase, there will be phase two, phase three, phase four. It will go on for two years.”

Operation Clean Money was launched on February 1. With its inception, the IT department had detected over 1 crore accounts after risk analysis and matching of cash deposits data, where the cash deposits exceeded Rs 2 lakh after the demonetisation move. Of the 1 crore accounts, the IT department sent communications to 18 lakh taxpayers initially, whose cash deposits didn’t match their respective profiles.

Sushil Chandra, chairman of Central Board of Direct Taxes (CBDT) said that if the answers to the 18 lakh communications are satisfactory, then the IT department will not engage further, thereby closing the verfication process. However, if the taxpayers cannot explain the source of income within 10-day window, then the IT department will have to issue a notice to them.

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