Nagpur: What began as a routine verification turned into a staggering revelation. In a district once synonymous with Naxal insurgency, not financial intrigue, the Income Tax Department’s Intelligence and Criminal Investigation Wing (ICIW) has unearthed over Rs 1,100 crore in unreported deposits at the Gadchiroli District Central Cooperative Bank, money that allegedly stayed off the official radar for five consecutive years. The discovery has left even seasoned tax officials stunned.
Sources revealed that investigators, while combing through branch-level records on Wednesday, detected glaring gaps between the bank’s internal ledgers and the mandatory Statement of Financial Transactions (SFT) filings required under the Income Tax Act.
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What emerged was startling:
• Rs 300 crore in cash deposits concealed within current accounts
• Rs 600 crore routed through savings accounts
• Rs 200 crore parked in term deposits
All of it, investigators say, absent from the SFT disclosures that should have automatically alerted the tax department.
Incredibly, the undisclosed amount is said to be nearly equivalent to the bank’s total deposits currently reflected on its books, a red flag that has intensified scrutiny.
How did It go unreported?
Under Section 285BA of the Income Tax Act, banks, including cooperative banks, are legally bound to report high-value transactions. Cash deposits exceeding Rs 50 lakh in current accounts and Rs 10 lakh in savings accounts must be disclosed through Form 61A or 61B filings by May 31 each year.
Yet investigators reportedly found repeated instances where individual accounts breached these thresholds, without corresponding filings.
Savings accounts showed cash infusions of Rs 10 lakh or more, cumulatively touching Rs 600 crore. Current accounts reflected deposits crossing Rs 50 lakh. The five-year retrospective audit also indicated that significant withdrawals occurred alongside the deposits, suggesting that the funds were not idle, they were actively circulated.
Was this oversight, systemic failure, or deliberate suppression? That is now the central question.
A pattern, not an exception?
The SFT mechanism functions as the tax department’s financial surveillance grid, cross-verifying high-value transactions against income declared in tax returns. Its purpose is to ensure that large deposits, investments, or property transactions do not escape scrutiny.
Failure to comply attracts penalties, Rs 500 per day for delayed filing, escalating to Rs 1,000 per day after notice. Incorrect reporting carries a flat Rs 50,000 fine. But in this case, the scale of omission suggests consequences far beyond routine penalties.
Sources confirmed that investigators are now tracing the origin of the deposits and examining whether the funds correspond with declared incomes of account holders.
Bigger than Gadchiroli?
The Gadchiroli case may not be isolated. Sources indicated that similar drives across the region have so far detected nearly Rs 10,000 crore in unreported deposits in around seven cooperative banks.
The unfolding probe raises uncomfortable questions about regulatory oversight, internal compliance systems, and whether cooperative banking networks have become soft targets for financial opacity.
As tax officials continue their scrutiny, one fact is clear: what remained buried in ledgers for five years has now surfaced, and the ripple effects could extend far beyond a single district bank.
For a region striving to rewrite its narrative from conflict to development, the emergence of a financial irregularity of this magnitude has added an unexpected and unsettling twist.
