Amended and updated notes on section 285BA of Income Tax Act 1961 as amended by the Finance Act 2022 and Income-tax Rules, 1962. Detail discussion on provisions and rules related to Obligation to furnish statement of financial transaction or reportable account.
Chapter XXIII (Sections 281 to 298) of the Income Tax Act 1961 deals with the provisions related to Miscellaneous. Section 285BA of IT Act 1961 provides for Obligation to furnish statement of financial transaction or reportable account.
Recently, we have discussed in detail section 285B (Submission of statements by producers of cinematograph films) of IT Act 1961. Today, we learn the provisions of section 285BA of Income-tax Act 1961. The amended provision of section 285BA is effective for financial year 2022-23 relevant to the assessment year 2023-24.
In this article, you will learn detail of the provisions of section 285BA of the Income Tax Act, 1961 Bare Act read with the Income-tax Rules, 1962 as provided by Ministry of Law and Justice, Government of India.
Section-285BA: Obligation to furnish statement of financial transaction or reportable account
Section 285BA(1) of Income Tax Act
Any person, being—
- (a) an assessee; 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 institution; or
- (l) a person, other than those referred to in clauses (a) to (k), as may be prescribed,
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.
Section 285BA(2) of Income Tax Act
The statement referred to in sub-section (1) shall be furnished for such period, within such time and in the form and manner, as may be prescribed.
Section 285BA(3) of Income Tax Act
For the purposes of sub-section (1), “specified financial transaction” means any—
- (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,
which may be prescribed :
Provided that the Board may prescribe different values for different transactions in respect of different persons having regard to the nature of such transaction.
Section 285BA(4) of Income Tax Act
Where the prescribed income-tax authority considers that the statement furnished under sub-section (1) is defective, he may intimate the defect to the person who has furnished such statement and give him an opportunity of rectifying the defect within a period of thirty days from the date of such intimation or within such further period which, on an application made in this behalf, the said income-tax authority may, in his discretion, allow; and if the defect is not rectified within the said period of thirty days or, as the case may be, the further period so allowed, then, notwithstanding anything contained in any other provision of this Act, the provisions of this Act shall apply as if such person had furnished inaccurate information in the statement.
Section 285BA(5) of Income Tax Act
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.
Section 285BA(6) of Income Tax Act
If any person, having furnished a statement under sub-section (1), or in pursuance of a notice issued under sub-section (5), comes to know or discovers any inaccuracy in the information provided in the statement, he shall within a period of ten days inform the income-tax authority or other authority or agency referred to in sub-section (1), the inaccuracy in such statement and furnish the correct information in such manner as may be prescribed.
Section 285BA(7) of Income Tax Act
The Central Government may, by rules made under this section, specify—
- (a) the persons referred to in sub-section (1) to be registered with the prescribed income-tax authority;
- (b) the nature of information and the manner in which such information shall be maintained by the persons referred to in clause (a); and
- (c) the due diligence to be carried out by the persons for the purpose of identification of any reportable account referred to in sub-section (1).