The nine years of income proofs nobody keeps for you

The morning the notice arrived

One morning in May, at her desk in the Indian subsidiary of a US-listed technology company, a principal engineer — call her Priya — opened her inbox and found an email from insight.incometax.gov.in. The subject line read:

Summons under Section 131(1A) — A.Y. 2017-18 — Please respond within 15 days.

Attached was a four-page PDF. It asked her to produce, among other things, year-wise passport copies dating back to 2005, complete bank statements with transaction narration for FY 2015-16 and FY 2016-17, source-of-investment evidence for every credit into her Indian bank account during those years, and the annual brokerage statements for her employer's stock plan administrator account.

Priya had filed her ITR on time every year. She had paid every rupee of capital gains tax when her RSUs vested and sold. She had never been contacted by the Income Tax Department before. And she had not kept a single piece of paper from 2016.

The summons she received is not unique. It is a structural template applied to thousands of Indian taxpayers each year by the department's automated Project Insight system — and the questions it asks are ones every holder of a foreign asset should already know the answer to. If you are an Indian MNC employee with RSUs from a US or European parent company, a returning NRI with a foreign bank account, or an Indian resident who has ever invested abroad, the same summons can arrive in your inbox. What follows is a walkthrough of what it actually asks for, where those documents don't live, and how long you are expected to preserve them.

The lookback is longer than you think

Indian income tax law requires you to retain records for far longer than most salaried professionals realise.

• Seven years (Income Tax Act, 1961, Rule 6F and related provisions) — the standard retention period for records supporting an income tax return, measured from the end of the relevant assessment year.
• Up to ten years — the reassessment window that can be opened under Section 148 / 148A where the department alleges income escaping assessment.
• Sixteen years (Black Money (Undisclosed Foreign Income and Assets) and Imposition of Tax Act, 2015) — for any foreign asset or foreign income, the retention obligation extends to sixteen years. This is by far the longest statutory lookback under Indian direct tax law.
• Effectively indefinite — for property and long-term capital gains, where the original purchase deed, payment proofs, and improvement costs may be needed decades after acquisition to establish cost of acquisition under Section 48.

Priya's summons arrived in 2025 and asked about FY 2016-17. That is a nine-year lookback. It was not exceptional — nine years sits comfortably within the sixteen-year Black Money Act window that the Foreign Assets Investigation Unit (FAIU) routinely uses. A nine-year-old question is routine, not exceptional.

Crucially, the lookback is not triggered by anything the taxpayer did wrong. Under Project Insight — the Income Tax Department's integrated data analytics platform, operational since around 2017-18 — the department continuously ingests data from:

• CRS / FATCA reports from foreign tax authorities (the US, UK, Singapore, UAE, and other partner jurisdictions), covering foreign financial accounts, balances, dividends, and capital gains
• Annual Information Statement (AIS) populated from 20+ domestic sources
• Statements of Financial Transaction (SFT) filed by banks, mutual funds, demat depositories, registrars, and property registrars for transactions above statutory thresholds
• Form 26AS, GSTN, customs filings, and high-value property registration data

Project Insight cross-matches all of this against filed ITRs and flags discrepancies automatically. No human has to decide to audit you. When a mismatch is flagged, a notice is generated and assigned to an officer. In Priya's case, the CRS data received from the US IRS showed her stock plan administrator account and its year-end balance — data which did not appear in Schedule FA of her filed AY 2017-18 ITR. The system flagged the gap. The gap found her, nine years later.

The same system also flags routine domestic triggers that have nothing to do with foreign assets — large cash deposits, mutual fund investments above ₹10 lakh, property purchases above ₹30 lakh, refund-claim inconsistencies, risk-scored Section 143(2) selection. Once any of these opens a case, the information demanded is structurally similar to what Priya received: source of every credit, supporting document for every claim, chain of funds year by year. The foreign-asset cases have the longest lookback (sixteen years), but the document burden is the same shape across all of them. Even a routine 143(1) intimation from CPC — the automated processing result every taxpayer receives — can flag TDS mismatches or missing income that require the same documents.

The implication is uncomfortable and important: you do not need to have done anything wrong to get a Project Insight notice. You just need to hold an asset — foreign or domestic — that another system reports to the department, combined with a filing that does not fully explain it. The system finds the gap, and the gap finds you.

What a scrutiny notice actually asks for

The canonical structure of a Section 131(1A) summons to an individual taxpayer is remarkably stable across cases. Priya's notice ran to eleven numbered demands in its Annexure-A. In plain language, here is what each demand actually asks for — and what document satisfies it.

Eleven demands. Every single one of them requires documents that come to you from a bank, a broker, an employer, a foreign entity, a government registry, or a wet-signature chain of paperwork. The Indian government does not keep these documents for you. Neither does any third-party service you may currently rely on.

Where these documents don't live — the three gaps

When a summons like Priya's arrives, most people instinctively check the places they assume will hold their records. Each of those places fails, in a structural way worth naming.

Gap 1 — DigiLocker is an identity wallet, not an income proof vault

DigiLocker is an excellent government service, but it is scoped to a specific purpose: holding government-issued identity and credential documents. It holds your Aadhaar, your PAN card, your driving licence, your vehicle registration certificate, and your educational mark sheets and degree certificates. It is the system of record for documents the government issues to you.

It does not hold your Form 16. It does not hold your monthly salary slips, your rent receipts, your ESOP exercise statements, your foreign brokerage statements, your foreign bank records, or your wire transfer confirmations. There is no DigiLocker integration that fetches these from your employer, your landlord, your broker, or your bank. These are private documents — issued by private parties, distributed directly to you — and DigiLocker was never designed to hold them.

Gap 2 — The Income Tax portal holds your filings, not your source documents

The Income Tax portal (incometax.gov.in) holds what you have filed with the department: your ITR returns, ITR-V acknowledgements, Form 26AS (tax credit statement), the Annual Information Statement (AIS), tax challans, and refund status records. These are valuable — and you should always back them up from the portal — but they are only the final output of your tax filing process. They are not the evidence behind the numbers.

Form 26AS shows that a certain amount of TDS was deducted from your salary. It does not show your Form 16 or your salary slips. The AIS shows that a certain dividend was credited in a certain year. It does not show the foreign brokerage statement that explains where that dividend came from, or the W-8BEN you signed with the broker, or the 1042-S the broker issued. Your ITR acknowledgement shows that you filed a return claiming certain income and deductions. It does not show the working sheet you used to compute that income, or any of the supporting evidence.

Gap 3 — Your CA is not the safety net you think — and never was

Most readers assume their CA is a final backstop. For documents of this age, they are not — and the reason is more structural than most people realise.

Under ICAI standards, chartered accountants must retain their own audit working papers for a minimum of seven years — but this applies only to statutory audit engagements, not routine tax filing work for individuals. For non-audit work there is no mandatory retention period at all. In practice, most CAs keep their own computation sheets for 5–7 years and a copy of the filed ITR in perpetuity. They do not typically retain client source documents — because those source documents never pass through the CA's hands in the first place.

When you prepare your return with a CA, the CA receives a set of summary numbers — "salary income ₹X, interest ₹Y, capital gains ₹Z on foreign shares" — along with supporting paperwork that they review, use to validate the numbers, and return to you. They do not keep your foreign brokerage statement. They do not keep your Form 16 beyond what is needed to file that year's return. They do not keep your wire transfer confirmations. These documents come to you from the issuing party, stay with you, and the CA only ever sees the one-line number that appears in the ITR.

Even where a CA did retain a file, by year eight or nine a retirement, a practice sale, a laptop failure, or a routine office purge has usually erased it. Single-practitioner CAs often keep working files on a personal laptop with no rigorous backup protocol. Larger firms align retention with indemnity insurance windows of 5–7 years and purge older material to free up space.

The honest question to ask your CA is not "do you have it?" — it is "did you ever have it?" For source documents like foreign broker statements, foreign bank statements, wire transfer confirmations, 1099s, 1042-S forms, and grant letters, the answer is almost always no.

What to preserve, and for how long

The only reliable custodian of your income proofs is you.

For an Indian MNC employee with foreign equity — Priya's profile — the practical checklist runs to nine categories. Each should be kept, organised by financial year, for at least sixteen years after the relevant assessment year.

• Grant letters and award agreements for every RSU, ESOP, and ESPP grant you ever receive, with the grant date, vesting schedule, and reference price. Source: your employer HR or stock plan portal at grant time. Nobody else retains this beyond 5–7 years post-separation.
• Vesting statements, one per vesting event, showing shares vested, fair market value at vest date, perquisite value computed, and statutory withholding tax paid in shares. Source: stock plan administrator portal. May be purged from the portal after you leave the company.
• Annual brokerage statements, showing opening balance, closing balance, every transaction, every dividend, every fee. Source: stock plan administrator or downstream broker. Download annually the day they become available.
• Form 1099-DIV / 1042-S or equivalent, the annual dividend or withholding summary from the foreign broker. Source: broker. Emailed PDF, easily lost.
• W-8BEN form signed with the broker at account opening and whenever renewed. Source: broker. Rarely asked for, critical when it is.
• Wire transfer confirmations and FIRCs for every flow between your foreign account and your Indian bank account, in either direction. Source: your Indian bank, at the time of the transaction. Banks purge digital records of line-item detail after 5–8 years.
• Capital gains computation working sheets, one per year you sell any foreign equity, showing how you arrived at the gain figure. Source: yours, contemporaneous with filing. Keep both the numbers and the underlying logic.
• Foreign tax credit / DTAA relief workings, if you claimed relief under a tax treaty for tax withheld by the foreign country. Source: yours. Nobody else keeps this. KarSafe's free Form 67 calculator generates this working for you, along with a country-specific checklist of the supporting foreign tax documents you must retain alongside it.
• Your filed ITR with Schedule FA, for every year you held any foreign asset. Source: your own backup, not just the IT portal. The single most important document in any foreign-asset scrutiny proceeding.

Returning NRIs and HNIs with foreign business interests have additional categories beyond this list — residency day-counts across NR / RNOR / ROR transitions, 401(k) / IRA statements, DTAA computations across multiple jurisdictions, FEMA compliance records, structured investment paperwork. Those profiles are covered in forthcoming articles.

The timeframes are not arbitrary:

The practical rule: if you hold any foreign asset now — or have held one at any time in the past sixteen years — your records must reach back to the year of acquisition. The Black Money Act window is measured from the year the asset was first held, not the year it was sold.

The private layer

The only place where all of this can realistically live is a private vault that you control. A folder on your current laptop is not a vault — it disappears at the next device refresh. A Google Drive folder is better but is not organised by financial year, not encrypted end-to-end, and not designed to be a primary legal archive. Gmail search is not a vault at all; it is triage.

Disclaimer. Priya is fictional. The scenario is synthesised from a real IT summons with all identifying details removed. Not legal advice. Consult a CA for your specific case.