Income Tax Department Flags Suspicious Foreign Remittances
Income Tax Department Flags Suspicious Foreign Remittances; 394 Entities Under Verification
New Delhi, 18 August 2026: The Income Tax Department has commenced a nationwide verification exercise concerning certain entities suspected of making unusually large foreign remittances over the past three years.
The action follows data analysis and field intelligence indicating that a number of entities may have remitted substantial amounts of foreign exchange despite reporting relatively low business turnover or having limited tax-filing records.
Suspicious Remittance Patterns Identified
According to the Department, the investigation has identified a network of entities allegedly involved in transactions connected with accommodation entries against purported donations or contributions.
Initial field verification reportedly found that several entities making significant outward remittances were either non-filers or had disclosed very small turnovers in their income-tax returns. The reported business figures also did not appear consistent with the substantial amounts sent overseas.
The Department has further observed discrepancies between the stated reasons for certain remittances and the financial profile of the entities involved. Purposes cited for the transactions included payments relating to freight, software imports and consultancy services.
Field-level enquiries also indicated that some of the entities were not operating from the addresses declared in their records.
Concerns Regarding Form 15CB Certifications
Data analysis has additionally highlighted a considerable number of Form 15CB certificates issued by a relatively small group of professionals.
The Department has raised concerns regarding the circumstances in which these certificates were issued, particularly where the remittances were subsequently received by a closely connected group of entities.
Form 15CB certification requires an accountant to examine relevant financial records and supporting documents before certifying the taxability of a foreign remittance. The findings have therefore prompted the Department to examine whether appropriate professional due diligence was undertaken before such certificates were issued.
Nationwide Verification Exercise
On 18 August 2026, the Income Tax Department initiated a detailed verification exercise covering the entities involved in the identified transactions.
The exercise is primarily focused on:
- Entities suspected of being shell or accommodation-entry entities;
- Persons associated with or controlling such entities;
- Professionals who issued Form 15CB certificates;
- Entities located in districts along India’s land borders; and
- Other entities that have remitted significant amounts of money overseas.
The verification exercise covers approximately 394 entities, including around 117 entities located in States sharing land borders, along with 36 professionals.
Reminder for Professionals Issuing Form 15CB
The Department has reiterated that professionals issuing certificates in Form 15CB / Form 146 are expected to exercise appropriate due care, diligence and professional judgement.
Before certifying a foreign remittance, the accountant should properly examine the underlying transaction, supporting documentation, books of account and other relevant facts to determine the applicable tax treatment.
The Department has indicated that such certifications are an important component of the framework governing foreign remittances and therefore require careful professional examination.
Further investigation into the identified cases is ongoing.
Source: Press release issued by the Income Tax Department, Ministry of Finance, Government of India, dated 18 August 2026.
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