Beware, Your Investments are Reported

Income tax notice for me? Not possible! My friend Natarajan reacted in disbelief when his wife informed him on phone. He had no reason to believe her. He immediately called me to know what could be the reason. I had to dig details to know what could be the reasons for which my friend Natarajan and the likes are served such notices.


You may be the one to whom the income tax department has sent the notice about the investments you made in bonds/debentures /shares /mutual funds. You are further surprised that how the income tax department has come to know about it.


So for all you first timers, I would like to share with you that as per the existing provisions under income tax laws some entities are required to report the details of those transactions which you have entered into or registered with them. This way we see that such notices are the result of the details furnished by those companies/mutual funds whose shares, bonds and units, etc you have purchased directly from the company.....(Read More)