I-T Department Uncovers Major Under-Reporting of Real Estate Deals in Nagpur

Nagpur: The income tax department has uncovered significant under-reporting of real estate transactions in Nagpur, this time at the Sub-Registrar Office (SRO-7). An earlier scrutiny had revealed that property registrations worth close to Rs1,000 crore were not reported to the department by the SRO Hingna.

Gross under-reporting has now been detected in SRO-7, which covers areas under Nagpur city. Primary investigations showed that deals worth close to Rs500 crore were not reported by the SRO. The investigations are continuing.

The action was taken by the income tax's Intelligence and Criminal Investigation (I&CI) wing, which also oversees reporting under the Statement of Financial Transaction (SFT) by various agencies. An initial probe into the returns based on the findings showed a number of individuals who reported income running up to Rs10 to 20 lakh a year, purchased properties running into tens of crores. The money for the purchases was shown as unsecured loans, according to sources. In a number of cases, capital gains were not paid by the sellers of properties.

Any registration of a property worth over Rs30 lakh has to be reported under SFT. This helps the taxman keep tabs on deals that may not have been reported in the tax returns. Sources say some of the deals not reported by the SRO include those by some prominent persons in the city. A similar under-reporting was unearthed in Malkapur tehsil of Buldhana too.

The discovery of these under-reported transactions highlights the ongoing challenges in ensuring transparency and compliance in the real estate sector. The I&CI wing is expected to take stringent actions to prevent such under-reporting in the future and to ensure that all transactions are accurately reported to the income tax department.