The Income Tax Department has become increasingly vigilant in tracking high-value financial transactions to ensure accurate reporting of income and reduce tax evasion. Under the E-campaign initiative, the department sends alerts and seeks clarification from taxpayers who may have missed disclosing such transactions in their Income Tax Return (ITR).
If you’ve received a message from the department regarding a high-value transaction, don’t panic—you have the option to view the details and submit a proper response online. This guide explains what these high-value transactions are, why you received a message, and how to respond under the e-campaign.
What is the Income Tax E-Campaign?
The E-Campaign is an outreach initiative by the Income Tax Department that aims to promote voluntary compliance by taxpayers. It is not a notice under any penalty or prosecution section, but rather an opportunity to review and correct discrepancies in reported income before any formal scrutiny begins.
The campaign targets individuals and businesses where there is a mismatch between the department’s data and the ITR filed—or where no ITR was filed despite high-value transactions being recorded.
What Are High-Value Transactions?
High-value transactions are specific financial activities that exceed set thresholds and are reported to the Income Tax Department by banks, mutual funds, and other institutions under the Annual Information Return (AIR) and Statement of Financial Transactions (SFT) framework.
Here are common examples of high-value transactions:
- Cash deposits exceeding ₹10 lakh in savings bank accounts in a financial year.
- Fixed deposit of more than ₹10 lakh in a year.
- Credit card payments exceeding ₹1 lakh in cash or ₹10 lakh in total.
- Mutual fund investments exceeding ₹2 lakh or more.
- Purchase of bonds or debentures over ₹5 lakh.
- Real estate transactions above ₹30 lakh.
- Purchase of shares exceeding ₹10 lakh.
All of the above transactions are reported to the Income Tax Department, even if the individual doesn’t file a return.
Why Did You Receive a High-Value Transaction Alert?
You may receive an alert under the e-Campaign if:
- Your total income reported in ITR is not sufficient to justify large financial transactions.
- You have not filed your ITR, but high-value transactions are reported in your AIS.
- There is a mismatch in your ITR and Form 26AS or AIS.
- You are associated with suspicious cash flows, property dealings, or investments.
In short, if the department's data suggests that your actual income or financial activity is higher than what you’ve declared, your case may come under the scanner.
Consequences of Not Responding to E-Campaign
Failure to respond to the e-Campaign notice or discrepancies can lead to:
- Scrutiny assessments under Section 143(2)
- Reassessment notices under Section 148
- Penalties for underreporting income
- Interest charges under Sections 234A/B/C
- Prosecution in serious cases
Responding within the deadline and updating your ITR helps you avoid legal complications.
Best Practices for Taxpayers
Regularly monitor your AIS and Form 26AS on the income tax portal.
Match your ITR data with high-value transactions reported by third parties.
Avoid last-minute filings to allow time for corrections if needed.
If you're unsure how to respond, consult a tax expert or CA.
Conclusion
The Income Tax Department’s e-Campaign initiative on high-value transactions is an important reminder to ensure accurate and transparent tax reporting. It’s not a notice or penalty—it’s an opportunity to clean up discrepancies voluntarily. Ignoring these alerts or submitting inaccurate returns may attract penalties, interest, or reassessment.
To stay on the right side of the law, always file your returns on time, verify your AIS, and respond promptly to any e-Campaign communications.
