AIS feedback for IPO

Hi team,

I had applied for the IPO of Senco Gold in the BHNI category, but was not allocated any shares. Still it is being displayed in my Annual Information Statement and it is adding up to the buy column in the TIS (Tax Information Summary).

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My question is, that even though I was not allocated any shares(had applied via ASBA), why is this being reported to the AIS and increasing compliance for us? Is this legitimate or should we mark any feedback for this? Gross amount received and Gross amount paid cancels out each other anyway.

Hello @tarun

ITD have started mapping all the transactions in the AIS to track the financial information of a taxpayer at one place.

Here, since in an IPO, funds were added to bank account and blocked for 3 days, it means you paid to the company and got refunded back.

But because there was no allotment of shares, no capital gain tax would come into picture. However, ITD may ask for the source of funds in case your Income tax return for the respective financial year does not have sufficient source of income to justify these funds.

Hope, this helps.

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I am not a tax professional, but based on my understanding, there is no law passed by Parliament that requires taxpayers to give feedback on AIS. As long as you are reporting your income and assets correctly in the ITR, you are compliant with the law. In my opinion, the IT department is just trying to shift the burden of work they are supposed to do on the taxpayer by asking them to correct all errors in the AIS.

I would personally only give feedback on the AIS if it is showing some income that I did not actually receive . Every year, my AIS has some dividends missing and several other reporting errors . I just report the correct income on the ITR and ignore the errors in the AIS.

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