The Intelligence and Criminal Investigations Wing of the Income Tax Department conducted a large-scale survey on Monday at the Etmadpur registry office. During the five-hour inspection, financial irregularities worth around ₹900 crore in property ‘bainamas’ (sale deeds) were uncovered. Earlier, similar inspections were carried out by the department in Kirawali and Sadar areas.
Chaos Erupts During IT Survey
As soon as the investigation began, chaos broke out in the sub-registrar office. Staff panicked, and people coming to register properties tried to move around frantically. The department’s team asked a series of questions, but many sale deeds went unexplained. Officers found that the sub-registrar office had failed to comply with SFT (Special Financial Transaction) reporting, which is mandatory under income tax rules.
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Cash Payments, Reporting Lapses Found
Cash Payments Under Scrutiny: Several sale deeds were found showing cash payments. The Income Tax team obtained records from the registry and instructed the sub-registrar to make all documents available. This could tighten the noose on those involved in high-value transactions.
Reporting of ₹30 Lakh Bainamas Ignored: For property transactions of ₹30 lakh or more, reporting to the Income Tax Department is mandatory. Additionally, cash transactions above ₹20,000 are prohibited under the law. The sub-registrar office failed to follow these rules. The department also demanded records from previous years to determine when and how violations occurred.
TDS, PAN, Form 60 Violations Exposed
Neglect of Formalities: Deduction of TDS (Tax Deducted at Source) and recording of PAN numbers is compulsory during registration of property. These formalities were not followed in past transactions. The department has indicated action against responsible parties for this negligence.
Form 60 and SFT Reporting: For transactions of ₹10 lakh or more, if the buyer does not have a PAN, Form 60 must be filled. Additionally, SFT Forms 61 and 61A are required to report financial transactions to the Income Tax Department. The sub-registrar office did not comply, resulting in regulatory violations.
Complaints Trigger Deeper Probe
Complaints Against Sub-Registrar: MLC Akash Agrawal and the Etmadpur Bar Association had filed complaints with the government, alleging large-scale financial irregularities in sale deeds. The Bar Association presented evidence showing attempts to mask high-value transactions using minimal stamp fees.
TDS and Capital Gains Violations: For sale deeds of ₹50 lakh or more, buyers must deduct 1% TDS from the seller. However, several builders conducted high-value deals on urban agricultural land without deducting TDS or recording PAN numbers. In these cases, capital gains were ignored, and transactions were kept away from tax scrutiny. The department is now conducting a detailed investigation.
According to regulations, agricultural land within eight kilometers of urban limits is considered a capital asset. Section 2(14) of the Income Tax Act applies, making TDS and capital gains tax applicable. The Income Tax Department has begun a comprehensive review of related sale deeds and indicated action for any violations found.
In summary, the five-hour inspection at the Etmadpur registry office exposed financial irregularities in ₹900 crore worth of property transactions. Cash payments, reporting lapses, and procedural violations were uncovered. Notices have been issued to the concerned parties, and strict action is expected soon.
About the author – Ayesha Aayat is a law student and contributor covering cybercrime, online frauds, and digital safety concerns. Her writing aims to raise awareness about evolving cyber threats and legal responses.
