The Income Tax Department has initiated a nationwide campaign against suspicious outward foreign remittances. On 18th August (Tuesday), the Income Tax Department stated that multiple dubious companies have been found to transfer significant amounts of foreign exchange over the past three years, as determined by data on outgoing foreign remittances and ground records.
“A nationwide network of entities engaged in remitting funds abroad was uncovered during a search operation conducted on a group of fictitious charitable trusts involved in providing accommodation entries against bogus donations/contributions,” read the official release.
The Income Tax Department has launched a nationwide verification exercise into suspicious foreign remittances. The exercise follows data analysis and ground intelligence indicating significant overseas remittances by entities with little or no reported business activity.
— Income Tax India (@IncomeTaxIndia) August 18, 2026
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The preliminary ground verification unveiled that the entities producing these deposits were either non-filers or were filing income-tax returns with relatively small turnovers. The department pointed out that there seems to be no connection between the turnovers and the substantial sums of money sent overseas.
Additionally, they didn’t seem to align with the declared objective of remittances, which included paying for goods, importing software or consulting services. Further ground-level intelligence indicated that these entities did not operate from the places they claimed.
A more thorough examination of the data demonstrated that “a large number of Form 15CB certificates were issued by a relatively small group of professionals. The remitted funds were also received by a clustered group of entities. Form 15CB, read with Rule 37BB of the Income-tax Rules, 1962 (corresponding to Form 146 read with Rule 220 of the Income- tax Rules, 2026), requires the accountant certifying a foreign remittance to verify its taxability with reference to the books of account and other relevant documents.”
The results, however, cast doubt on whether the accountants performed sufficient due diligence prior to giving these certifications. In light of these developments, the department initiated a comprehensive verification procedure aimed at confirming these outward remittances, concentrating on shell companies, the individuals responsible for them and the professionals who issued Form 15CB certificates.
The exercise has also covered entities that are situated in districts along the nation’s land boundaries and send substantial sums of money outside. It revolves around 394 entities, including 117 entities in states with land borders, and 36 professionals.
The notification added, “The department emphasises that accountants issuing certificates in Form 15CB/Form 146 are expected to exercise due care, diligence and professional judgment. They should properly examine the underlying transactions and relevant facts before certifying the remittances, as these certifications play an important role in maintaining trust in the system. Further investigations are currently underway.”
It was signed by V. Rajitha, Commissioner of Income Tax (Media & Technical Policy) & Official Spokesperson, Central Board of Direct Taxes (CBDT).
The noose tightens on doubtful foreign funding
The aforementioned marks yet another pivotal step by the Modi government in its battle against suspicious foreign funding. The government has already introduced the Foreign Contribution (Regulation) Amendment Bill to tackle the menace of illegal finances entering the country for nefarious purposes under the guise of help or aid.
The government has taken action against several organisations over the years following investigations or inspections that led to assertions of financial irregularities, misappropriation of foreign contributions, breaking FCRA regulations, or engaging in activities that went beyond their stated goals.
Hence, the bill was proposed to ensure that the allocated funds are applied for their designated purposes, instead of being misappropriated for questionable objectives, such as religious conversions or interference in India’s internal affairs in the name of protests. It has been sent to a Joint Parliamentary Committee (JPC).
