my friend did not have any income, he got 2lakh loan from his relatives and he started a small business, after few days he went to bank for loan purpose, the bank people asked to bring IT Returns
now he wants to file it return but he did not have any works and income in previous year
finally he filed IT Return and he showed income as commission income from Real Estate for loan purpose
my doubt is it legal or illegal or offense or fraud
1. tax return should be field irrespective of income and you may file a nil return i.e. return showing nil income.
2. bank's purpose is to verify the legal identity of the business and in very rare cases bank uses to calculate the income from the tax return, it has nothing to do with the loaning.
Further, if you have shown commission income in the return then straight away your loan will be refused. real estate business, commission based business are negative professions in banking industry and businessmen engaged in such businesses are not considered in for the loan. you may get list of negative businesses from your bank. avoid to include income from such businesses in the tax return.
Querist :
Anonymous
Querist :
Anonymous
(Querist)
22 April 2013
Dear Rashid Mehmood, thank for your reply
Sir my actual query is in above case assesee filed it return and he showed his income as 300000 (tax also paid) in that time is it legal or illegal or fraud
if legal if he will be selected for scrutiny then what documents he can show
22 April 2013
There is nothing illegal. So far as your income is not credited in your bank account, there is nothing, neither on your part nor on the part of department, to prove genuinity or ingenuity of the income. Again this is a normal practice, people file IT return with fake income. There is nothing serious. You can always put a stand that your income had been received in cash. Just try show low cash if there is actually no income. The bank asks for IT return just to have an idea, how far the person will be able to repay the loan installments.
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