CA Nilay Shah's Blog

Form 61A clarification about Audited Case u/s 44AB : If there is reportable transaction - ITDREIN registration is mandatory and Filling of Form 61A is mandatory, also SFT preliminary response is compulsory. If nil transaction - ITDREIN registration not mandatory, Form 61A not mandatory and SFT preliminary response in optional (not mandatory) But it is advisable to file SFT preliminary response in case of NIL transactions. One more thing, for filling NIL SFT preliminary response, generation of ITDREIN is not required at all, you can submit all the responses against all 14 SFT without selecting ITDREIN number column. If assessee is audited u/s 44AD then also provisions of audited case u/s 44AB is applicable because 44AD audit is also governed by Section 44AB only. You can also check this Press Release on the same issued by Income Tax Department :  26-05-2017-Press Release- Clarification-SFT

Statement of Financial Transactions (SFTs) . To keep a watch on high value transactions undertaken by the taxpayer, the Income-tax Law has framed the concept of ‘Annual Information Return (AIR)’ which now substituted by statement of financial transactions (SFTs). With the help of the statement the tax authorities will collect information on certain prescribed high value transactions undertaken by a person during the year. Statement of financial transaction or reportable account is to be filed by certain prescribed entities (discussed later), and in such statement, they are required to furnish the details of specified financial transactions or any reportable account registered/recorded/maintained (discussed later) by them during the year. Thus, based on the information provided by certain prescribed entities in statement of financial transaction or reportable account, the Income-tax Department keeps a track of specified financial transactions carried on by a person during the year