Exemption from declaration in Annual Information Return(AIR)

The Central Board of Direct Taxes (CBDT) has exempted individual taxpayers from declaring high value transactions with banks, mutual funds, credit cards etc in their income tax returns forms.The recently notified returns Sahaj and Sugam , ITR II and ITR III does not carry AIR blocks.

However, point to be kept in mind is the AIR is still in statute book. Government will have this information while checking the Income Tax returns.

The income tax department has a special arrangement with the National Securities Depository Ltd ( NSDL )) where companies issuing shares or bonds, banks, credit card companies, mutual fund houses, the Reserve Bank of India , registrars and sub-registrars for property transactions can file the AIR either physically or online. 

These institutions notify the high value transactions an individual has entered into with them. As such, the details will be available to the Department. So, on a selective basis, the income tax officer can verify or select cases for scrutiny.