The Income Tax Informants Reward Scheme, 2018, introduced by the Central Board of Direct Taxes (CBDT), allows individuals to receive rewards for providing specific information about tax evasion related to income and assets in India and abroad. Informants can earn up to ₹5 crores, with the scheme regulating the grant and payment of rewards for information that leads to the detection of substantial tax evasion. Only information submitted in the prescribed format (Annexure-A) qualifies for a reward, and government employees are excluded from eligibility. Information considered includes documents, emails, and other relevant materials but excludes submissions via non-official channels like social media or messaging apps. Substantial tax evasion is defined based on thresholds of ₹1 crore to ₹5 crores, depending on the investigation directorate involved. The scheme also ensures the confidentiality of the informant’s identity and the information provided. Interim rewards of up to 3% or 1% are available based on the nature of the information, with final rewards capped at ₹5 crores. Additionally, foreign informants can participate, and the scheme outlines procedures for group informants, the handling of false information, and coordination with other reward schemes such as the Benami Transactions Informants Reward Scheme, 2018.
FAQs on Income tax informants reward scheme, 2018
Q1. What is Income Tax Informants Reward Scheme, 2018?
Ans: The Income Tax Informants Reward Scheme, 2018 (“the Scheme”) is a reward scheme introduced by the CBDT for payment of rewards to a person who is an informant under this scheme. A person who is an ‘Informant’ can get a reward of up to Rs. 5 crores by giving specific information about the evasion of Income tax on income and assets in India and abroad. The scheme is effective from 23-04-2018.
Q2. What is the scope of this scheme?
Ans: This scheme shall regulate the grant and payment of rewards to informants in cases where information is received by a JDIT (Inv.) from the Informant on or after the date of issue of this scheme that leads to the detection of substantial tax evasion under the provisions of Income Tax Act, 1961 and/or the Black Money (Undisclosed Foreign Income & Assets) and Imposition of Tax Act, 2015. This scheme shall not be applicable to information regarding the recovery of irrecoverable taxes as the Central Board of Direct Taxes has issued separate Guidelines for the same vide F. No. 385/2112015-IT (B) dated 26-8-2015.
Q3. Who is considered an Informant under this scheme?
Ans: A person will be considered an informant for the purposes of this scheme only if he has furnished specific information of substantial tax evasion in a written statement in Annexure – A to this Scheme and, based upon which, an Informant Code has been allotted to him by the prescribed authority.
Q4. Can any government servant be an ‘informant’ and claim a reward under the scheme?
Ans: No reward shall be granted under this scheme to any government servant who furnishes information or evidence obtained by him in the course of normal duties as a Government Servant. A person employed by the following shall be deemed to be a Government Servant for the purpose of this scheme:
a. Central Government;
b. State Government;
c. Union Territory Government;
d. Nationalised bank;
e. Local authority;
f. Public sector undertaking;
g. Corporation, body corporate or establishment, set up or owned by the Central Government or State Government or Union Territory Government.
Q5. What is considered information?
Ans: ’Information’ includes material in any form, such as records, documents, emails, data held in any electronic form and photographs which are relevant for the detection of undisclosed income under the Income-tax Act, 1961 and/or Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, provided either in person or by email or letter in accordance with this scheme.
Information given in any other manner, e.g., WhatsApp or SMS or phone or post on social networking site or publishing a letter in the newspaper or any other media, etc., shall not be treated as information.
In a case where information is received in instalments, the Informant shall furnish information in Annexure-A separately, and his entitlement for reward shall be computed with reference to the additional tax realised or realisable which is directly attributable to the information provided in each Annexure-A.
Q6. What is “substantial tax evasion”?
Ans: ‘Substantial tax evasion’ means evasion of taxes of not less than Rs. 5 crores of undisclosed income detected by Investigation Directorates of Mumbai, Delhi, Kolkata, Chennai, Hyderabad, Ahmedabad, Pune or Bangalore and not less than Rs. 1 crore of undisclosed income detected by other Investigation Directorates. If relevant cases are spread across more than one Investigation Directorate, substantial tax evasion means evasion of taxes of not less than Rs. 5 crores in aggregate in such cases on undisclosed income detected by the Investigation Directorates concerned.
Q7. Whether a person will be entitled to a reward if he furnishes specific information other than through Annexure-A?
Ans: A person cannot claim any reward under the scheme if he is not an informant under the scheme, even if such a person has furnished specific information of income or assets in any other manner, e.g., through letter, email, CD, WhatsApp, SMS, phone, posting in social networking site or publishing letter in a newspaper or any other media.
Q8. Whether confidentiality be maintained in the context of the Informant’s identity and information provided by the Informant?
Ans: The identity of the Informant, the information given by him (including all related documents/annexures), or the reward paid to him shall not be disclosed to any person/authority except when expressly required under any law for the time being in force or by order of any court of law. The documents/annexures relating to identity and information shall remain confidential and be dealt with accordingly. After allotment of the Informant Code, the person shall be identified with Informant Code only.
Q9. Whom should a person contact if he has information about substantial tax evasion?
Ans: A person who wants to give information about substantial tax evasion in expectation of reward under this scheme may contact the DGIT (Inv.)/PDIT (lnv.)/JDIT (Inv.) concerned. If he appears before DGIT (lnv.)/PDIT (Inv.), they will direct him to appear before JDlT (Inv.) concerned to furnish the information in Annexure-A.
Q9. What is the course of action if JDIT(Inv.) considers the information actionable?
Ans:If the jurisdictional JDIT (Inv.) considers the information prima facie actionable, the person shall have to submit the information in the prescribed format in Annexure – A by appearing in person before the JDIT (Inv.), when called. In case of any difficulty, the person desirous of giving specific information may contact the PDIT (Inv.) of the area. The decision of PDIT (Inv.) will be final in the matter of allotment of the Informant Code under this scheme.
Q10. What is the course of action where a foreign person is in possession of information?
Ans: Where a foreign person wants to give information on undisclosed foreign income/ assets of a person liable to tax in India, he may contact the Member (Investigation), CBDT, North Block, New Delhi-110001 either in person or by post or by communication at email id [email protected] with a copy to [email protected] for further action.
Q11. Who is a foreign person?
Ans: ‘Foreign person’ means an individual or group of individuals residing outside India.
Q12. What is the process if the information is furnished by a group of informants?
Ans: If the information is furnished by a group of informants (more than one Informant working together), the prescribed form, statements, etc., must be filled and signed by all such Informants jointly, and an Informant code will be allotted to each of them separately. The reward payable in such cases shall be disbursed in equal proportion unless specified otherwise by such informants at the time of furnishing information in Annexure-A.
Further, if an informant furnishes information in respect of more than one group of cases, Annexure-A shall be filled and signed separately for each such group. However, in such a situation, the Informant Code for such Informant shall remain one and the same.
Q13. What are the consequences if an informant furnishes false information?
Ans: If an Informant furnishes false information, such an act is considered an offence, and the person giving false information/evidence/ statement will be liable to be prosecuted for such offence.
Ans: Interim reward up to 3% of the additional taxes levied (which is directly attributable to the information furnished by him) under the Black Money (Undisclosed Foreign Income and Assets), Act, 2015, may be granted on the statutory determination of undisclosed foreign asset/income following completion of assessment proceedings under Section 10(3)/(4) of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, subject to a ceiling of Rs. 50 lakhs to an Informant for the information given at a time in a single Annexure – A form when the authority competent is satisfied that the assessment made is likely to be sustained in appeal and taxes levied are likely to be recovered.
Ans: Interim reward up to 1% of the additional taxes realisable, which is directly attributable to the information furnished by the Informant, on the undisclosed income detected by the Investigation Directorate under the Income-tax Act, 1961, may be granted subject to a ceiling of Rs. 10 lakhs to an informant for the information given at a time in a single Annexure- A form when the competent authority is satisfied that the additional taxes on the income detected are likely to be recovered.
Where specific information of unaccounted/undisclosed cash is given by the Informant, which leads to seizure of the cash exceeding Rs. 1 crore as undisclosed income/asset during search & seizure action under Section 132 of the Income-tax Act, 1961, the ceiling of interim reward shall be Rs. 15 lakhs even though the rate will be same at 1% as specified above.
Q16. What is the time limit for the payment of the interim reward?
Ans: All reward-granting authorities shall endeavour to pay the interim reward to an informant eligible for such reward within:
a. 4 months of completion of the relevant assessments under Section 10(3)/(4) of the Black Money(Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, in cases information of undisclosed foreign income/assets is given;
b. 4 months of forwarding of the final investigation report by the Investigation Directorate concerned to the Assessing Officer in cases where information of undisclosed income/assets liable under the Income-tax Act, 1961, is given.
Q17. What is the quantum of the Final reward for information on undisclosed foreign income/assets liable under the Black Money (Undisclosed Foreign Income and Assets) Act, 2015?
Ans: The maximum amount of reward payable to an informant who has furnished information about undisclosed foreign income or assets of a person liable to tax in India under the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, shall not exceed 10% of the additional taxes levied and realised under the said Act, which are directly attributable to the information furnished by him, subject to a ceiling of Rs. 5 crores after the assessment has become final on the issues relevant for determination of reward by appeals, revision, rectification etc.
Q18. What is the quantum of the Final reward if the Informant is eligible for a reward under Income Tax Informants Reward Scheme, 2018 and Benami Transactions Informants Reward Scheme, 2018?
Ans: If the Informant has claimed the reward for giving information of evasion of tax payable under Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, as well as benami properties based upon substantially the same facts and has been found eligible for grant of reward under both the schemes, the total amount of reward under both the schemes taken together shall not exceed Rs. 5 crores.
Q19. What is considered an Additional Tax?
Ans: Additional taxes means Income-tax and surcharge, if any, which is directly attributable to the information given by the Informant. It, however, does not include interest, cess, penalty and any other levy/fee imposed or imposable under the Income-tax Act, 1961 and/or the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015.
Q20. What is Additional taxes realisable under this scheme?
Ans: ‘Additional taxes realisable’ means Income-tax and surcharge, if any, which is payable on the amount of income directly attributable to the information given by the Informant out of total additional income detected as per the Appraisal Report or final survey report or other final investigation report by the Investigation Directorate, over and above income disclosed in the return, if any, filed by the assessee.
Q21. What is the quantum of reward if the Informant is eligible for a reward under Income Tax Informants Reward Scheme, 2018, and Benami Transactions Informants Reward Scheme, 2018?
Ans: If the Informant has claimed reward under this scheme as well as Benami Transactions Informants Reward Scheme, 2018, based upon substantially the same facts (as was given for claiming reward under this scheme) and if the same is separately found eligible for grant of reward in accordance with these schemes, the total amount of reward under both the schemes taken together shall not exceed the maximum permissible amount under the Income Tax Informants Reward Scheme, 2018, or this Scheme, whichever is higher.
In other words, if an informant is found eligible for reward under both the schemes for information relating to the PBPT Act and the Income Tax Act, 1961, the total maximum reward under the two schemes shall be restricted to Rs. 1 crore as is the limit in this scheme and if an informant is found eligible for a reward under both the Schemes for information relating to the Act and the Black Money (Undisclosed Foreign Income and Assets) Act, 2015, the total maximum reward under the two Schemes shall be restricted to Rs. 5 crores as is the limit in Income Tax Informants Reward Scheme, 2018.
Q22. When shall the final reward be processed?
Ans: The final reward for information of undisclosed foreign income/assets liable under the Black Money (Undisclosed Foreign Income and Assets), 2015 or for information of undisclosed income/assets liable under the Income Tax Act, 1961 shall be processed on the realisation of additional taxes directly attributable to the information given by the Informant.
Q23. What are the different stages that are considered for processing the final award?
Ans: Such processing may be initiated at different stages, which may include the following:
a. Where relevant assessments/appeals have attained finality, i.e., against which no appeal/further appeal/revision/rectification etc. is pending or a period of 12 months has elapsed from the statutory time limit for filing such appeal/revision/rectification etc.;
b. Where relevant case(s) is/are settled by the ITSC by way of an order under section 245D(4) of the Income-tax Act, 1961, and such order has attained finality, i.e., against which no litigation/rectification etc., is pending and a period of 12 months has elapsed from the date of such order of ITSC; or
c. Where the relevant case(s) are under litigation on certain issues but the informant requests for grant of final reward based upon the undisputed additional taxes realised directly attributable to the information furnished by him, till the date of his request and gives an unconditional written undertaking signed in the presence of the JDIT (Inv.) concerned that he will have no further claim of reward in the relevant group of cases.
Q24. Whether the amount of the Final reward is in addition to the Interim reward?
Ans: No, the amount of the interim reward already paid shall be reduced while granting the final reward.
Q25. What is the time limit for the payment of the final reward?
Ans: All reward-granting authorities shall endeavour to pay the final reward to an informant eligible for such reward, within 6 months of fulfilment of the conditions mentioned in this scheme.
26. What are the different modes for the payment of rewards to a non-resident informant?
Ans: The reward granted to a foreign person, who is an informant, may be paid by regular banking channel as per guidelines issued by the Reserve Bank of India (otherwise than cash), to his bank account in India or abroad, as requested in writing by the Informant, in Indian Rupees or its equivalent US Dollar at the exchange rate prevailing at the time of actual payment of the reward. Commission or charges for payment in US Dollars shall be deducted from the gross reward amount granted.
Q27. Who is considered a Competent Authority to grant reward?
a. Interim reward: The authority competent to grant Interim reward shall be a Committee consisting of the concerned (i) DGlT (Inv.), (ii) PDIT (Inv.) & (iii) JDIT (Inv.). The JDIT (Inv.) concerned shall also act as Secretary of the Committee. Formal sanction order for payment of the reward shall be issued by the PDIT (Inv.) concerned.
b. The authority competent to grant the Final reward shall be a Committee consisting of the concerned: (i) DGlT (Inv.), (ii) PDIT (Inv.); (iii) PCIT & (iv) JDIT (Inv.). The JDIT (Inv.) concerned shall also act as Secretary of the Committee. Formal sanction order for payment of the reward shall be issued by the PDIT (Inv.) concerned. The PCIT here refers to the PCIT under whose charge the cases relevant to the determination of reward are assessed to tax pursuant to the receipt of the report from the Investigation Directorate. Where the cases relevant to the determination of reward are assessed across many PCIT charges, the PCIT for the purpose of the Committee shall be the PCIT of whose charge the assessed cases contribute to the maximum amount of relevant additional taxes. However, inputs from all other PCsIT will be taken and considered by the Committee before the grant of the reward.
c. In case of any difficulty in deciding the composition of the Committee, the DGIT (Inv.) concerned may refer the matter to the Member (Investigation), CBDT and form the Committee in consultation with him.
Q28. What are the relevant factors that are considered for the determination of Interim or Final reward?
Ans: The following factors may be considered for the grant and payment of interim or final reward:
a. Fulfilment of conditions for grant of interim or final reward, as the case may be, mentioned in this scheme.
b. Accuracy and precision of the information furnished by the Informant.
c. Extent of the usefulness of information, including supporting documents etc. provided by the Informant.
d. Extent and nature of assistance rendered by the Informant in the detection of undisclosed income/asset.
e. In the case of the final reward, the amount of additional taxes levied and realised on the undisclosed income/asset detected, which is directly attributable to the information received from the Informant.
f. Risk and trouble undertaken and expenses incurred by the Informant in securing and furnishing the information.
Q29. Circumstances in which the Informant is not eligible for any reward
Ans: No reward shall be granted to an informant under the following circumstances:
a. Where the information is not provided in accordance with the scheme;
b. Where the terms and conditions of the scheme are not fulfilled;
c. Where the information given is not of substantial tax evasion;
d. Where the information given is vague/non-specific and/or of general nature;
e. Where the information given is already available with the Income Tax Department;
f. Where the information is not received directly from the Informant but through any organisation other than Income Tax Department;
g. Where additional taxes on the undisclosed income detected are not directly attributable to the information given by the Informant;
h. Where Income Tax Department has evidence that the information given by the Informant has been shared by him or any other person authorised by him, with any other entity/agency, including media; or
i. In respect of incidental or collateral benefit which may arise to revenue in any other case as a result of the information furnished by the Informant.
The following are some illustrative situations in which Informant will not be entitled to reward:
a. In a case where an informant has furnished information pertaining to modus operandi only without any specific information regarding parties involved/assets generated/transactions entered, etc. and pursuant to such information, the investigation conducted by Investigation Directorate leads to detection of undisclosed income, the Informant will not be eligible for any reward for the information even if the modus operandi is found to be correct;
b. In a case where an informant has furnished specific information pertaining to bogus expenses/purchase or modus operandi or income or assets, etc., in respect of some persons and pursuant to such information, the investigation conducted by Investigation Directorate leads to the detection of bogus expense/purchase or modus operandi or income or assets etc. in respect of additional persons also, the Informant will not be eligible for any reward in respect of the bogus expense/purchase or modus operandi or income or assets etc. of the additional persons, irrespective of the fact that the Informant had explained the modus operandi etc.
c. In a case where search & seizure has been conducted, and additional taxes have been levied and realised, but such additional taxes are not directly attributable to the information provided by the Informant.
d. In a case where an informant has furnished specific information pertaining to undisclosed assets and pursuant to such information, the investigation conducted by Investigation Directorate does not lead to the detection of the undisclosed assets in respect of which the information was furnished, the Informant will not be eligible for any reward even if any other undisclosed asset was detected in the investigation and the Informant had explained the modus operandi.
e. In a case where an informant has furnished specific information pertaining to some undisclosed assets and pursuant to such information, the investigation conducted by Investigation Directorate leads to the detection of some undisclosed assets in addition to those informed by him, the Informant will not be eligible for any reward in respect of the additional undisclosed assets detected, even if the Informant had explained the modus operandi.
Q30. Is there any possibility of not taking cognisance of the information furnished by an informant?
Ans: In case it is found that the antecedents of the Informant, the nature of the information furnished by him in past, and his conduct justify not taking cognisance of the information furnished by him, the matter shall be referred by the JDIT (Inv.) to the PDIT (Inv.) concerned and, if approved by the PDIT (Inv.), it would be open to the JDIT (Inv.) to ignore the information furnished by the Informant.
Q31. What are the provisions with respect to the non-disclosure of information regarding the taxpayer/assessee?
Ans: The CBDT or the Income Tax Department does not provide feedback and/or update on the information received or subsequent actions taken thereon. Disclosure of information regarding specific taxpayers is prohibited except as provided under section 138 of the income-tax Act, 1961 and Section 84 of the Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015, read with section 138 of the Income-tax Act, 1961. Directorates-General of Income Tax (Investigation) are exempt from providing information under Section 24 of the Right to Information Act, 2005 read with the Second Schedule thereof.
In case of any grievance, the Informant may contact the PDIT (Inv.) concerned, who shall take necessary steps to redress the grievance expeditiously.
Q32. Can the Informant file an appeal against the amount of reward?
Ans: Reward in accordance with this scheme shall be ex-gratia payment granted at the absolute discretion of the authority competent to grant reward. The decision of the authority shall be final, and it shall not be subject to any litigation, appeal, adjudication and arbitration except review as provided in this scheme.
Q33. Is there any remedy for Final reward available to the Informant if the Informant alleges injustice in the decision of the competent authority?
Ans: In case an informant alleges grave injustice in the decision of the competent authority for final reward due to either non-adherence to the Reward Scheme issued by the Board or due to factual incorrectness, he may file a review petition within one month of receipt of the decision, before the DGIT (Inv.).
In such petition, he has to clearly bring out the basis of the alleged grave injustice with specific reference to the provisions of the Reward Scheme, which have not been followed by the reward committee or instances of factual incorrectness. No cognisance will be taken of a review petition if it is not mentioned as to which provision of the Reward Scheme was not followed or instances of factual incorrectness.
Q34. Will an assignment of the reward by the Informant be recognised?
Ans: Since the reward under this scheme is in the nature of an ex-gratia payment, no assignment thereof made by the Informant will be recognised. The authority competent to grant reward may, however, grant reward to the legal heirs or nominees of an Informant who has passed away. But the provisions of the scheme shall apply to the heir as would have applied had the Informant not died. For this purpose, the Informant shall specify the nominee at the time of furnishing the information. If there is more than one legal heir or nominee, the reward shall be distributed in equal share unless indicated otherwise in Annexure – A or the right is relinquished by any or more of the legal heirs.
