As per section 285BA of the Income Tax Act, 1961, specified persons are required to report transactions prescribed under Rule 114E of the Income Tax Rules, 1962, which are registered or recorded on or after 1.4.2016, by furnishing statement of financial transaction in Form No. 61A.  In respect of transactions registered or recorded in the Financial Year 2016-17, the statement of financial transaction has to be furnished by such persons on or before 31st May, 2017.

It may be noted that Rule 114E, substituted with effect from 1.4.2016, also requires any person who is liable for audit under section 44AB of the Income-tax Act, 1961 to report transaction of receipt of cash payment exceeding Rs. 2 lakh (per transaction) for sale of goods or services of any nature in the Financial Year 2016-17.  The scope of transactions to be reported by banks under new Rule 114E has also been expanded.  Also, the value of transactions in respect of which reporting is required has undergone a change. Co- operative banks, NBFCs, Nidhi, companies listed on a recognized stock exchange purchasing its own securities and Post Master General are also required to report relevant transactions of the nature and value specified in Rule 114E from F.Y.2016-17.

In this context, the procedure for registration and submission of statement of financial transactions as per section 285BA of Income-tax Act, 1961 read with Rule 114E of Income-tax Rules, 1962, contained in CBDT Notification No. 1/2017 dated 17/1/2017, is available at .  This Notification also contains the details of the nature and value of transactions & class of persons who are required to report such transactions.

Accordingly, these requirements may be communicated to your clients (being persons who are liable for tax audit under section 44AB or other specified persons who are required to report such transactions) or your employer (being a specified person required to report such transactions), as the case may be, so that the statement of financial transaction in respect of specified transactions registered or recorded in the Financial Year 2016-17 is filed by them on or before 31st May, 2017.

Source- ICAI

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  1. ks says:

    Dear Sir,

    please guide if For bulk purchase/ sale between 2 dealers of foreign exchange, where amt is recd in cheque above 10 lacs.
    Is it a reportable transaction under sft11??
    Please guide.

  2. Mahendra Soni says:

    Rule 114E states “The statement of financial transaction required to be furnished under sub-section (1) of section 285BA of the Act shall be furnished……”

    Further Sub rule 2 of Rule 114E states “The statement referred to in sub-rule (1) shall be furnished by every person mentioned in column (3) of the Table……”

    The wordings Shall be furnished denotes mandatory filing of Form 61A, even if their are NIL transaction, the assesse is required to file SFT. In my view in the absence of clarification from Income Tax Dept, it would be a better to file SFT report and avoid penalty of Rs 200 per day would be

  3. J.P.Gupta says:

    In my opinion whether there are reportable transactions or not the ‘person’ should file a NIL return. It is risky to read an exception to the rule.

  4. CA. PAWAN KUMAWAT says:

    is it compulsory to file sft before 31 may 2017 for those entity covered under 44AB, if there is no report able transaction. Like NIL return.
    Kindly suggest.
    Meanwhile Thanking You

  5. RAM SINGH says:

    Is it compulsory for all the companies covered under tax audit to file SFT in FORM 61A, even though there is no transaction to report.
    it is to be filed only when there is reportable transactions covered under SFT in a financial year.

  6. Snehal Thakkar says:

    Is it mandatory to register and file SFT return even when reporting items are not applicable or there are no transection during the year from the list.

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June 2021