Section 285BA of Income Tax Act, 1961 deals with Obligation to furnish statement of financial transaction or report able account and rule 114E of Income Tax Rules deals with Furnishing of statement of financial transaction (SFT). These SFT transaction is required to be filed in Form 61A which describe as under:
Applicability of Form 61A:
Only those persons who have registered or recorded the transactions as specified in Rule 114E (2) read with Section 285BA (1) are required to file Form 61A.
Due date of furnishing statement of financial transaction (SFT):
- The due date furnishing of SFT transaction in Form 61A is 31stMay, immediately following the financial year in which the transaction is registered or recorded.
- Example: For the FY 2019-20 the due date will be 31st May 2020.
Penalties for Non Filing of Form 61A under section 271FA:
- DEFAULT IN FILING FORM 61A u/s 285BA (1):In case a person does not File Form 61A on or before the due date e.g. 31st May, 2020 then penalty @ Rs. 500 per day for the period of default.
- DEFAULT IN FILING FORM 61A SUBSEQUENT TO A NOTICE RECEIVED FROM DEPARTMENT U/S 285BA (5):If after receipt of notice for non-filing of Form 61A, further default is made in filing 61A then after that, penalty @ 1000 per day shall be leviable for such further delay.
- Penalty of Rs. 50,000 u/s 271FAA for furnishing inaccurate particulars in Form 61A: A maximum penalty shall be levied if the person liable to file Form 61A furnishes inaccurate/untrue particulars and the original statement shall be treated as invalid.
Whether NIL statement is required to file:
- CBDT has released a Press Release on 26/05/2017 which says that The registration of reporting person (ITDREIN registration) is mandatory only when at least one of the Transaction Type is reportable in other words Form61A is required to be submitted only if there is at least one reportable transaction.
- Therefore, it can be concluded that is not Mandatory to file NIL Statement. However, it is advisable to submit SFT Preliminary Response.
Important Issue for Any person who is liable for audit u/s 44AB of Income Tax Act 1961:
The CBDT in its press release dated 22.12.2016 has clarified that besides its Notification No.91/2016 dated 06.10.2016 that the aggregate of cash receipt during the year is not the benchmark for reporting. In other words, the requirement under SFT reporting is receipt of cash payment exceeding Rs.2 lakhs or more for sale of goods or services per transaction.
Hence, the aggregation rule is applicable for all transaction types except SFT- 012 (Purchase or sale of immovable property) and SFT- 013 (Cash payment for goods and services)
|S. No.||Particular||Requirement of Reporting|
|1||Each invoice less than of Rs. 2 Lakh an aggregate sale below of Rs. 2 Lakh during the Financial Year||No|
|2||Each invoice less than of Rs. 2 Lakh and aggregate sale above of Rs. 2 Lakh during the Financial Year||No|
|3||Any one invoice above of Rs. 2 Lakh and all receipt in cash||Yes|
|4||Any one invoice above of Rs. 2 Lakh and all receipt in ECS/Account payee cheque/NEFT/RTGS/Draft||No|
Rule 114E (Transaction to be reported) in Form 61A :
|S. No.||Class of Person||Nature and value of Transaction||Amount|
|1||Any person who is liable for audit u/s 44AB of Income Tax Act 1961||Receipt of cash payment for sale, by any person, of goods/ services of any nature||Exceeding of Rs. 2 Lakh|
|2||Banking Company including co-operative bank||Cash payment for purchase of Demand Draft/Pay orderCash payment for purchase of prepaid instrument of RBI||Aggregate of Rs. 10 Lakh or more in a financial year|
|2A.||Banking Company including co-operative bank||Cash deposit or withdrawals for one or more current account of a person||Aggregate of Rs. 50 Lakh or more in a financial year|
|3||Banking Company including co-operative bank, Post Master General||Cash Deposits in one or more accounts (Other than Current account and time deposit)||Aggregate of Rs. 10 Lakh or more in a financial year|
|4||Banking Company including co-operative bank, Post Master General, Nidhi, NBFC||One or more time deposits (Other than time deposit made through renewal of another time deposit)||Aggregate of Rs. 10 Lakh or more in a financial year|
|5||Banking Company including co-operative bank||Aggregate payment made by any person against one or more credit card bill in a financial year||Rs, 1 Lakh or more in Cash or Rs. 10 Lakh or more in any other mode|
|6||Company or institution issuing Bonds or Debentures||Receipt from any person for acquiring bonds/debentures (other than amount received on account of renewal of bonds or debentures)||Aggregate of Rs. 10 Lakh or more in a financial year|
|7||Company issuing Shares||Receipt from any person for acquiring shares (including share application money)||Aggregate of Rs. 10 Lakh or more in a financial year|
|8||Companies listed on recognized stock exchange||Buy back of shares from any person other than share bought in the open market||Aggregate of Rs. 10 Lakh or more in a financial year|
|9||Trustee/Manager of Mutual Fund||Receipt from any person for acquiring of units of one or more schemes of a Mutual Fund (Other than on transfer of unit from one scheme to another scheme)||Aggregate of Rs. 10 Lakh or more in a financial year|
|10||Authorized Person of FEMA||Receipt from any person for sale of foreign currency including any credit or expense of such currency||Aggregate of Rs. 10 Lakh or more in a financial year|
|11||Inspector General or Registrar/Sub-Registrar of Property||Sale or purchase of any immovable property by any person||Rs. 30 Lakh or more or valued by stamp valuation authority at Rs. 30 Lakh or more|
|12||Banking Company including co-operative bank, Post Master General||Cash deposits during the period 09th November, 2016 to 30th December, 2016||Aggregating to
(i) Rs. 1250000/- or more, in one or more current account of a person; or
(ii) Rs. 250000/- or more, in one or more accounts (other than a current account) of a person.
|13||Banking Company including co-operative bank, Post Master General||Cash deposits during the period 1st of April, 2016 to 9th November, 2016||in respect of accounts that are reportable under Sl. No.12.|
Aggregate Rule of SFT:
- Aggregation rule needs to be applied for specified transaction types to identify transactions/persons/accounts which are reportable. Rule 114E specifies that the reporting person shall, while aggregating the amounts for determining the threshold amount for reporting in respect of any person –
- take into account all the accounts of the same nature maintained in respect of that person during the financial year;
- aggregate all the transactions of the same nature recorded in respect of that person during the financial year;
- 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;
The aggregation rule is applicable for all transaction types except SFT- 012 (Purchase or sale of immovable property) and SFT- 013 (Cash payment for goods and services).
To whom to file Form 61A:
- Form No. 61A shall be furnished to the Director of Income-tax or the Joint Director of Income-tax through online by using digital signature
- In case of a reporting person, being a Post Master General or a Registrar or an Inspector General, the said Form 61A may be furnished in a computer readable media, being a Compact Disc or Digital Video Disc (DVD), along with the verification in Form-V on paper.