Income Tax Department Uncovers Major Under-Reporting of Real Estate Transactions in Nagpur
The Income Tax Department has uncovered significant under-reporting of real estate transactions in Nagpur, with deals worth nearly Rs500 crore not reported by the SRO. Similar discrepancies were found in Malkapur tehsil of Buldhana. Stay updated with the latest local news from your city.
Real EstateIncome TaxUnderreportingNagpurSroReal Estate NewsAug 13, 2025
The action was taken by the Income Tax's Intelligence and Criminal Investigation (I&CI) wing, which 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 ranging from Rs10 to 20 lakh a year, purchased properties worth tens of crores. The money for the purchases was often shown as unsecured loans, according to sources. In many 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 tax authorities keep tabs on deals that may not have been reported in tax returns. Sources indicate that some of the deals not reported by the SRO involve prominent individuals in the city. A similar under-reporting was also uncovered in Malkapur tehsil of Buldhana.
The findings highlight the need for stricter oversight and enforcement of reporting standards in the real estate sector. The Income Tax Department is expected to take further action to ensure compliance and recover any lost tax revenue. The ongoing investigations may lead to more revelations and potential legal action against those involved in these under-reporting schemes.
This issue underscores the importance of transparency and accountability in the real estate market, especially in major cities like Nagpur. The government is committed to ensuring that all transactions are reported accurately to prevent tax evasion and maintain the integrity of the financial system.
Frequently Asked Questions
What is the Statement of Financial Transaction (SFT)?
The Statement of Financial Transaction (SFT) is a document that records financial transactions over a certain threshold. It helps the tax authorities track high-value transactions to ensure they are reported correctly in tax returns.
Why is under-reporting of real estate transactions a concern?
Under-reporting of real estate transactions is a concern because it can lead to tax evasion, loss of government revenue, and undermine the integrity of the financial system. It also creates an unfair advantage for those involved in such schemes.
What actions can the Income Tax Department take against those involved in under-reporting?
The Income Tax Department can take several actions against those involved in under-reporting, including demanding back taxes, imposing penalties, and initiating legal proceedings. The severity of the actions depends on the scale and nature of the under-reporting.
How does the SFT help in detecting under-reporting?
The SFT helps in detecting under-reporting by providing a comprehensive record of high-value transactions. Tax authorities can cross-verify the information in the SFT with tax returns to identify discrepancies and investigate further.
What is the threshold for property registration to be reported under SFT?
Any registration of a property worth over Rs30 lakh has to be reported under the Statement of Financial Transaction (SFT). This threshold helps the tax authorities monitor significant real estate transactions.
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