e-Campaign on Significant Transactions — what it means and what to do

What this notice actually is

• It is a communication on the compliance portal, not a statutory notice, and it does not open a proceeding.
• It is driven by information the department already has — statements of financial transactions, tax deducted at source, and the annual information statement.
• It typically covers significant or high-value transactions, or the fact that no return was filed for a year in which such transactions appear.
• You respond transaction by transaction, confirming, correcting or explaining each one.

Why it was issued

A e-Campaign and the Compliance Portal is generated for a defined set of reasons rather than at random. The ones we see most often are these.

• A high-value property purchase or sale reported by the registrar.
• Large cash deposits or credit card payments reported by a bank.
• Securities or mutual fund transactions reported by the registrar or depository.
• Foreign remittances sent or received, reported under the remittance reporting rules.
• Tax deducted at source in your name for a year in which no return was filed.
• Information suggesting income above the filing threshold where no return appears on record.

The provision behind it

The e-campaign is an administrative outreach programme rather than a power exercised under a specific charging section, which is why the message does not cite one in the way a notice does. It sits on top of the department's information-gathering framework — the statements of financial transactions filed by banks, registrars, depositories and others, and the annual information statement built from them. The reason it matters legally is what it feeds: the same information, unexplained, supports the formation of a view that income has escaped assessment, and that is the gateway to a reassessment proceeding with its own notice, its own timelines and a far heavier process. An e-campaign response is the cheapest opportunity you will get to close that off.

How long you have

Each campaign runs for a stated period and the message will say by when a response is expected. There is no statutory 15 or 30 day clock in the way there is for a notice, which is precisely why people let it drift. Treat the stated date as real. Where you have missed it, you can still record a response — the compliance portal generally keeps the information visible and a late explanation on record is considerably better than none, particularly if a reassessment notice later arrives and you need to show that the transaction was always explicable.

How to respond, step by step

1. Step 1. Log in to the income tax portal and open the compliance portal, where the e-campaign and the individual information items are listed.
2. Step 2. Review each transaction against your own records before responding — the information is reported by third parties and is sometimes wrong, duplicated, or attributed to the wrong person.
3. Step 3. Choose the correct response for each item: the information is correct, is not fully correct, relates to another person or year, is duplicated, or is denied.
4. Step 4. Where the transaction is correct but not taxable — a transfer between your own accounts, a gift from a relative, the sale of an asset at a loss — say so and keep the supporting document ready.
5. Step 5. Where the transaction is correct and was taxable but not returned, the right answer is usually to file or revise the return rather than to argue, because doing so voluntarily is far cheaper than after a notice.

What to have ready

• Bank statements covering the flagged period.
• Sale deeds, purchase agreements or broker statements for the reported transactions.
• Evidence of the source of funds where a large deposit or investment is flagged.
• Gift deeds or correspondence where funds came from a relative.
• Foreign inward remittance certificates where the item is an overseas transfer.

What it costs to get this wrong

There is no penalty for receiving an e-campaign message and none for responding, whatever the answer. The exposure is entirely downstream. Unanswered information that suggests unreturned income supports the department in forming the view that income has escaped assessment, which leads to a reassessment proceeding — and at that stage you are dealing with statutory timelines, a formal notice, potential interest across several years and, where the omission was real, penalty. The asymmetry could not be starker: an hour on the portal now, against a proceeding later.

A word on notices that are not genuine

Fake tax notices circulate constantly by email and SMS, and they are convincing enough that people pay them. The department does not ask for payment to a personal account, does not demand immediate transfer to avoid arrest, and does not send a payment link by SMS. Every genuine communication carries a document identification number, and that number can be checked on the income tax portal before you act on anything. The safest habit is never to follow a link in a message at all: open the portal yourself, log in, and look under e-Proceedings. A real notice will be there. If it is not on the portal, it is not a notice — whatever the letterhead says.

The same applies to telephone calls. Assessment in most cases is now faceless, which means the officer handling your file does not know who you are and has no reason to telephone you. Anybody who calls claiming to be from the department, asks for one-time passwords, or offers to settle a demand informally, is not from the department. If you are unsure whether something is genuine, the cost of checking is a two-minute login.

Responding when you are outside India

Non-residents receive these notices too, often for years in which they believed nothing was taxable in India, and being abroad changes the practicalities rather than the obligation. Everything is done on the portal, so no travel is required, but two things commonly go wrong. The first is access: the registered email and mobile number on the portal are frequently the ones held when the person left India, and a notice arrives at an address nobody reads. Update the contact details on the portal before you need them. The second is verification — a response that is not verified is not a response, and the verification routes available to a non-resident are narrower. Establish which one works for you in advance rather than discovering the problem on the last day of a deadline.

Where the notice relates to a year governed by the earlier Act, the section number on it will follow the law as it stood when the notice was issued. That is not a defect and it does not make the notice invalid. Read what the notice says it concerns rather than trying to match the number against the current Act.

What happens after you respond

People assume a response ends the matter, and usually it does — but the closure is rarely announced. Once a reply is filed the item moves out of your pending list on the portal and, in most cases, nothing further is heard. That silence is the normal outcome and it is not something to chase. What you should do is keep your own record: the acknowledgement of the response, the date it was filed, and the documents you relied on. Two years later, if the same year is reopened on a different ground, that file is the difference between a short letter and a long argument.

Where the response is not accepted, you will be told. The department may ask a follow-up question, issue a further notice on the same year, or — where a demand was involved — simply leave it standing. The important thing is to watch the portal rather than your inbox. Email delivery fails, addresses go stale, and spam filters are unforgiving; the portal is the authoritative record of what has been issued to you and what is outstanding against you. Logging in once a month takes two minutes and is the single most effective piece of tax hygiene available to anyone who has ever received a notice.

One thing worth understanding is that responding to one notice does not immunise the year against another. Processing, scrutiny selection and reassessment are separate mechanisms operating on separate timelines, and an intimation resolved in March says nothing about whether the same year is selected for examination in November. Nor does it work the other way: a year that has been examined and closed is generally protected, but only on the grounds actually considered. Keeping the underlying records for the statutory retention period, rather than only until the immediate question goes away, is what makes the next enquiry cheap.

Other income tax notices

Where we act

We reply to income tax notices for individuals and businesses across India, entirely online. Assessment is largely faceless, so the officer handling your file may be anywhere — which means your own location no longer limits who can represent you.

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Common questions