Hospital Bills, Weddings, College Fees & High-End Shopping On Income Tax Department's Watchlist

The Central Board of Direct Taxes (CBDT) has directed the tax department to identify spending on hospital bills, weddings, medical college fees and high-end shopping and initiate a non-intrusive verification process to gather the necessary data. The scrutiny is also tightening on hotel bills and overseas trips as the tax department intensifies its efforts to monitor cash transactions across various business sectors. The CBDT has flagged a pattern of widespread cash dealings that often bypass mandatory reporting norms, prompting the Income Tax Department to take action. According to the CBDT’s recently issued Central Action Plan (CAP) for 2024-25, financial institutions are required to report cash transactions exceeding ₹2 lakh through a Statement of Financial Transaction (SFT). However, the board has identified significant gaps in compliance, with many businesses circumventing these regulations.