On August 18, 2026 the Income Tax Department announced that they have undertaken verification of suspicious foreign remittances based on ground intelligence and analysis of data on outward foreign remittances.
The Income Tax Department has said in a press release that they have identified several suspicious entities that remitted large amounts of foreign exchange over the last three years.
The Income Tax Department press release said: “On August 18, 2026, the Department launched a nationwide detailed verification exercise to verify these foreign remittances, focusing on shell entities, the persons behind them, and the professionals who have issued Form 15CB certificates.”
Indian Border areas also under watch
The Income Tax Department said that entities located in districts along the country’s land borders and remitting significant amounts of money abroad have also been covered in the exercise. The exercise has covered approximately 394 entities (including 117 entities located in land-border States), and 36 professionals.
The Income Tax Department said that further investigations are currently underway.
Recent tax search revealed nationwide network of entities remitting money abroad
The Income Tax Department said that 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.
Preliminary ground verification revealed that the entities making these remittances were either non-filers or were filing income-tax returns showing very small turnovers.
The tax department said that the turnovers of these suspicious entities had no apparent correlation with the large amounts of money being remitted abroad. They also did not appear to match the stated purpose of the remittances, such as payment for freight, import of software, or import of consulting services.
The Income Tax Department said: “Further ground-level intelligence revealed that these entities were not actually operating from the addresses declared by them.”
So the Income Tax Department officers did a further analysis of the data and this revealed that a large number of Form 15CB certificates were issued by a relatively small group of professionals and the remitted funds were also received by a clustered group of entities.
Chartered Accountant Ashish Niraj, Partner, A S N & Company, said to ET Wealth Online: “This is a much needed drive launched by the Department. Many shell companies are being operated by some persons whereby large amounts of funds were remitted abroad. Also in most of cases of such shell companies, TDS was not correctly deducted as per the provisions.
Gaurav Makhijani- Managing Partner at MGA says that the Income Tax Department routinely uses data analytics to track foreign remittances, and such transaction-level information can subsequently form the basis for queries or verification during tax proceedings.
Makhijani says: "What appears different in the present communication is the seriousness of the concerns flagged by the Department, including potential financial irregularities and, in certain cases, concerns having wider implications beyond conventional tax compliance. The focus on remittances involving entities or persons in sensitive border regions also indicates a heightened level of scrutiny."
