The Income Tax Department has launched a comprehensive, nationwide verification drive targeting a network of entities involved in high-value, suspicious outward foreign remittances over the past 3 years.
The action follows actionable ground intelligence and data analysis stemming from a search operation on fictitious charitable trusts that were issuing accommodation entries for bogus donations.
Key findings of the investigation:
The remitting entities were identified as either non-filers or tax filers reporting minimal turnover, showing no logical correlation with the substantial funds sent overseas.
Declared transaction purposes such as freight payments, software imports, or consulting services did not match actual operations, and ground checks confirmed that many entities were not operating from their registered addresses.
Analysis revealed that a small cluster of professionals issued a disproportionately high volume of Form 15CB certificates to a concentrated group of overseas recipient entities. Under Rule 37BB of the Income-tax Rules, 1962, certifying Accountants are required to verify taxability against books of account, raising serious concerns regarding the adequacy of due diligence performed.
Scope of the verification exercise:
On August 18, 2026, the Department targeted approximately 394 entities, including 117 located in districts along land-border states, alongside 36 professionals and the underlying facilitators of these shell entities.
“The Department emphasises that Accountants issuing certificates in Form15CB/Form 146 are expected to exercise due care, diligence and professional judgment. They should properly examine the underlying transactions and relevant facts before certifying the remittances, as these certifications play an important role in maintaining trust in the system,” said the Income Tax Department in a release.
Disclaimer: This article is for informational purposes only and does not constitute professional tax advice. Tax laws and regimes are subject to frequent changes by the government. Readers should verify details with official Income Tax Department notifications or consult a Chartered Accountant before making any financial decisions.
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