Any mismatch with income declared by the account holder will be treated as a case of tax evasion.
Decoys planted by the Income Tax department will be watching out at jewellery shops and banks for anyone trying to get multiple people to exchange their Rs 500 and Rs 1,000 notes, banned last week in Prime Minister Narendra Modi's unexpected move against undeclared wealth.
Taxmen are monitoring deposits after the two biggest currency notes were taken out of circulation. The government has said that deposits above Rs 2.5 lakh will draw a 200 per cent penalty if it there is a mismatch with the person's income.
Sources say the tax department has surveyed various cities like Karnataka, Kolkata, Goa and Mumbai and made significant recoveries.
In Goa, a jeweler in Panaji was caught with Rs 90 lakh in cash and jewellery stocks. He was from Mumbai and sold jewelry worth Rs 45 lakh to a client in Goa.
Over 4 crores was found during raids in Bengal.
In Punjab, where polls will be held next year, Rs 26 crores was found in Ludhiana.
Sources say the tax department is checking the sudden surge in sales in some cities. A spike in
Jan Dhan accounts - bank accounts at zero balance for the financial inclusion of all - is also under scrutiny.
The ban on the highest currency notes was announced in a massive move to crack down on black or untaxed money, but opposition parties say it has come at a huge cost to the common man. Millions have been forced to queue up at ATMs and banks for cash.
Crores in denominations of Rs 500 and Rs 1,000 have been found dumped or destroyed since last Tuesday.
In Uttar Pradesh sacks full of banned notes were found burnt. A large bundle of notes was found near a dustbin in Maharashtra.
Cash worth Rs 1.87 crore in denominations of Rs 1,000 and Rs 500 was found in raids at a plush home in Nagpur, around 700 km from Mumbai.
"The poor are sleeping peacefully and the rich need sleeping pills," PM Modi has said while referring to the notes ban in a series of public meetings.