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Hi Guys,
I have zeroed in one a property. ( Yet to verify the papers). It will be a 100% white transaction. However the seller doesn't want to register the entire amount. He is asking to pay a part of it to a family member. ( Through cheque/RTGS only). I wanted to register the full amount. So a little reluctant. I have two questions.
1. Will there be any legal implications?
2. Will it lead to some IT related issues?. I understand it will be the seller's headache. ( May be he is planning it show it as a business income.). What about the buyer (I mean the sender) ?. Will he/she be answerable?

A 100% white transaction is the one which is strictly mentioned in full, on the registered document. Even if part of it is not mentioned and paid to bank account, it cannot be called 100% white, since it's not traceable. Example, tomorrow in case of IT inquiry, what would be the reason to state for paying to the bank account? Following news article is very useful - https://www.jagoinvestor.com/2013/06/paid-black-money-for-property-and-saved-for-stamp-duty-and-registration.html

Thanks Lalitha for the response. That link talks about paying in cash and other aspects like resale etc.
My query is different. I am interested in IT related implications. I was under the assumptions its only the sellers ( receiver) headache. He needs to show it in his returns. But what are the possible issues for the buyer(sender)?. Can you be more specific?

Buyer's perspective :-
For example, one Mr. Ram is buying a property for 50 lakhs. 30 lakhs is mentioned on the registered sale deed document. Remaining 20 lakhs is paid to some bank account, as specified by the seller. Now, IT department can see bank account transaction from Mr. Ram's account for total 50 lakhs. In future, when there's an IT inquiry, Mr. Ram needs to answer for both 30 lakhs and 20 lakhs. Incase he says that 20 lakhs is also towards property sale, he needs to produce a registered sale document as proof.
And I am not stating this example without data. My relative (salaried class with full transparent income and tax payment) had an IT inquiry more than 5 years ago, for a discrepancy of mere 5 thousand rupees. He had transferred it to his family member's account for personal reasons and had to produce relationship proof!
To summarise, it's easy to say that this might be a rare case to get caught in an IT inquiry but fact remains the same, that incase of inquiry, we need to produce standard transparent transaction details. Now, with almost all data computerised, any IT official, with PAN number of a person, can extract all debit and credit data, at the click of a button. So, our balance sheets should be well maintained with sufficient evidence, to avoid getting into any trouble in future.

blr78 wrote: ↑

August 14th, 2021, 12:41 am

Hi Guys,
I have zeroed in one a property. ( Yet to verify the papers). It will be a 100% white transaction. However the seller doesn't want to register the entire amount. He is asking to pay a part of it to a family member. ( Through cheque/RTGS only). I wanted to register the full amount. So a little reluctant. I have two questions.
1. Will there be any legal implications?
2. Will it lead to some IT related issues?. I understand it will be the seller's headache. ( May be he is planning it show it as a business income.). What about the buyer (I mean the sender) ?. Will he/she be answerable?

Always stick to 100% white transaction. it's very easy to verify bank transactions these days.

Thanks Bangalore2021