CBDT Targets 394 Entities and 36 CAs: The Form 15CB Wake-Up Call

The Income Tax Department has opened a nationwide verification drive into suspicious outward foreign remittances routed through low-activity and shell-like entities and the professionals who certified them in Form 15CB are squarely in focus. Here is what the drive means, and exactly what due diligence a Chartered Accountant is expected to carry out before signing.

Quick takeaways

• On 18 August 2026, the CBDT launched a detailed verification exercise on suspicious foreign remittances.
• Roughly 394 entities and 36 professionals who issued Form 15CB certificates are covered.
• Red flag: large remittances that don't match reported turnover or real business activity.
• From 1 April 2026, Form 15CB is replaced by Form 146 under Rule 220, with mandatory UDIN.
• Clean working papers and genuine professional skepticism are now non-negotiable.

What the Income Tax Department has actually done

Based on ground intelligence and analysis of outward foreign remittance data over the last three years, the Department identified a network of entities that remitted large amounts of foreign exchange abroad while showing very small turnovers. Many were either non-filers or filed returns disclosing negligible income. In several cases the entities were not even operating from their declared addresses, and some were linked to fictitious charitable trusts providing accommodation entries.

The remittances were described under stated purposes such as freight, import of software, or import of consulting services — but the money moving out had no visible correlation with the size or nature of the businesses sending it. A relatively small group of professionals had issued a large number of Form 15CB certificates for exactly these entities, which is what pulled certifiers into the exercise.

Why this matters to every practising CA: the Department has publicly stated that Form 15CB certifications play an important role in maintaining trust in the remittance system. Routine, mechanical issuance based only on client-supplied paperwork is precisely the behaviour now under the scanner.

What is Form 15CB (now Form 146)?

Form 15CB is a tax-determination certificate issued by a practising Chartered Accountant under Rule 37BB of the Income-tax Rules, 1962. From 1 April 2026 it corresponds to Form 146 under Rule 220 of the Income-tax Rules, 2026. It is required when:

• A payment (or aggregate of payments) to a non-resident other than a company or to a foreign company exceeds ₹5 lakh in a financial year;
• The remittance is chargeable to tax in India under the Income-tax Act; and
• No lower/nil-deduction certificate has been obtained from the Assessing Officer under Section 195(2), 195(3) or 197.

The CA certifies the nature and purpose of the remittance, its taxability under Sections 5 and 9 (and any applicable DTAA), the correct TDS rate and related details. This certificate is a prerequisite before the remitter files Part C of Form 15CA (now Form 145).

The due diligence a CA is expected to perform

"Due diligence" here means the professional care, document examination and judgment a CA must apply before certifying. At a minimum, the Department and professional standards expect the CA to:

• Verify taxability with reference to the books of account and other relevant documents of the remitter;
• Properly examine the underlying transaction and the surrounding facts;
• Exercise due care, diligence and professional judgment — not mechanical certification.

Documents to review and retain

• Contract / invoice: Agreement or invoice supporting the remittance and its stated purpose.
• RBI purpose code: Nature of payment matched correctly to the applicable purpose code.
• TRC + Form 10F: Tax Residency Certificate and Form 10F where a DTAA benefit is claimed.
• No-PE declaration: Declaration of no Permanent Establishment in India, where relevant.
• Remitter financials: Books and financials, to test whether the remittance is consistent with turnover.
• PAN + UDIN: PAN details and, under Form 146, a mandatory ICAI UDIN on the certificate.

Practical tip: if the remittance value looks out of proportion to the client's declared turnover or activity, treat it as a red flag. Document the question you raised, the explanation received, and the evidence you relied on — before you sign.

How far does a CA's responsibility go?

The CA's core role is to determine taxability and the withholding rate from the documents and information presented — not to act as a forensic auditor investigating the commercial genuineness of every transaction. Courts, including the Supreme Court and the Madras High Court, have held that routine issuance of Form 15CB on client-furnished documents does not by itself amount to abetment under PMLA, where there is no knowledge of or involvement in fraud.

That said, a failure to exercise due diligence or to obtain sufficient information can amount to professional misconduct under Clauses 7 and 8 of Part I of the Second Schedule to the Chartered Accountants Act, 1949. ICAI expects reasonable professional skepticism.