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TaxSavvy for high value transaction notice
High value transaction email? Answer it the right way.
We match your AIS entries and file the response on the compliance portal.
How we get it done
Four steps, the same for every job. You see each one ticked.
Information
PAN. Notice, all pages, with DIN
Discussion
Is the transaction yours and already in a return?. Was a return not filed?
Forms
Response on the compliance portal. Belated or updated return if needed
Deliverables
Response acknowledgement. Return acknowledgement if filed
See what you get, free
Real formats, made with dummy data.
Sample Sample ₹36,280 less tax in the new regime
Sample Net worth ₹14.9 lakh
Questions, answered the CA way
Facts, Provisions and law, Analysis, Conclusion.
High-value transaction notice: SFT and AIS mismatch
- Facts
- Statement of Financial Transactions (SFT) requires banks, mutual funds, registrars, and others to report high-value transactions to the IT department. These appear in your AIS. When your AIS shows a transaction that doesn't appear in your ITR, you get a notice.
- Provisions and law
- IT Act, Sec 285BA | SFT Rules | AIS (Annual Information Statement)
- Analysis
- Common SFT triggers: Cash deposit above ₹10L in savings account. FD above ₹10L. MF purchase above ₹10L. Property sale above ₹30L. Credit card spend above ₹1L/month (for cash payers). Share transactions above ₹10L. The notice asks: "We see this transaction in your AIS. Why is it not reflected in your ITR?" Your response must explain the source, income already taxed, exempt income, loan, gift from relative, etc.
- Conclusion
- Identify the specific transaction in your AIS (amount, counterparty, date)
- Match to your bank statement, ITR, or investment records
- If the income was declared: point to the exact schedule in your ITR where it appears
- If it's exempt income (LTCG within limit, gift from relative, inherited): explain with documentary evidence
Section 270(8) (old 143(2)): Scrutiny Notice
- Facts
- This is NOT automated, a human officer has selected your return for detailed examination. Specific income, deduction, or transaction is under review. Must be responded to with documentary evidence within the timeline given.
- Provisions and law
- Sec 270(8) (old 143(2)); Sec 270(10) (old 143(3)); Sec 144; Faceless Assessment Scheme 2020; Sec 271(1)(c)
- Analysis
- Why your return was selected: (1) Large refund claim, officer verifies legitimacy. (2) High deductions claimed relative to income (e.g. Sec 123, Income-tax Act 2025 (old Sec 80C) of ₹1.5L on ₹3L income). (3) AIS shows transactions not declared (property purchase, large FD). (4) Specific issue risk profiling by IT department. (5) Information from third party (bank, registrar). Faceless assessment, how it works: Notice arrives on IT portal (also email). You respond online through IT portal → e-Proceedings → Response. Upload documents in PDF. No personal appearance. Officer is anonymous, from a different city. National Faceless Assessment Centre (NFAC) coordinates. What to submit: Depends on the specific query in the notice. Common documents: Bank statements, salary slips + Form 130 (old Form 16), investment proofs (ELSS receipts, PPF passbook), home loan certificate, rent receipts, capital gains statement, property registration documents.
- Conclusion
- Login to IT portal → e-Proceedings → View notices (Sec 270(8) (old Sec 143(2)) notice visible)
- Read notice carefully, identify exactly which item / transaction is under scrutiny
- Note response deadline from notice, calendar the date immediately
- Gather all documents related to the queried item (not your entire file)
Section 143(2) (now 270(8)), Scrutiny notice: the real assessment begins
- Facts
- Sec 143(2) (now Sec 270(8), Income-tax Act 2025) means the IT department has selected your return for detailed scrutiny. A human AO (Assessing Officer) or faceless assessment unit will examine specific items in your return. The notice will say what is being questioned, income, deductions, transactions.
- Provisions and law
- IT Act 1961, Sec 143(2) (now 270(8)) | Time limit: 3 months from end of AY | Notice must be issued within 3 months of end of AY (for AY 2024-25 → by 30 June 2025)
- Analysis
- Types of scrutiny: • CASS (Computer Aided Scrutiny Selection): System-selected based on risk parameters, high cash deposits, large deductions, mismatch with TDS data. • Manual scrutiny: AO specifically selected your case, usually means a tip-off or serious red flag. Sec 143(2) (now Sec 270(8)) leads to a formal assessment under Sec 143(3) (now Sec 270(10)). You must respond, ignoring it results in best judgment assessment (AO assumes the worst and raises a demand without hearing you).
- Conclusion
- Check the notice date, if beyond the time limit, the notice is invalid. File a legal objection immediately.
- Read exactly what is being questioned, don't respond to what isn't asked
- Do NOT submit documents before reading the full notice, scope creep is common
- Engage a CA immediately, your response creates a paper trail that affects all future proceedings
HUF as landlord: rental income and property tax strategy
- Facts
- If HUF owns a property (ancestral or purchased from HUF funds), all rental income belongs to HUF, taxed at HUF's slab rate. The HUF can also claim the ₹2L home loan interest deduction under Sec 22, Income-tax Act 2025 (old Sec 24) on the let-out property.
- Provisions and law
- Income Tax Act 1961, Sec 22-27 | Sec 24 (₹2L interest deduction)
- Analysis
- A high-earning individual (30% slab) who shifts rental income into HUF effectively pays 5% tax on the first ₹3.5L of rental income instead of 30%. Annual saving: ₹87,500 on ₹3.5L rental income alone.
High value transaction email? Answer it the right way.
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