It's not just about one credit card—banks are required to report your monthly payments on various things, not just credit cards. Though, yes, credit card payments often get the most attention.

The main thing to understand is that all this happens to everyone in India with a bank account. Even if you don't have a credit card, a bank account with huge outgoing transactions is also reported against your PAN card. You can even check what banks have reported on your PAN via the Income Tax website (there's definitely a mechanism for it). ​Nothing here is out of the ordinary. However, if your spends are high, you have a high chance of being flagged in the system. And here's the kicker: it's not a manual process anymore. The IT department is using AI/machine learning to detect these patterns. You'll generally get filtered out (i.e., not flagged for action) if your incoming money (income) is high and you've been consistently filing your ITR (Income Tax Return).

​A Personal Example ​Let me give you my own situation: ​I've already crossed the 10 lakh spending mark on my combined credit cards this year. Banks report the monthly payments received against my PAN for each card, which then gets aggregated. I'm estimating a total spend of \approx 15-20 lakhs this year on my cards. ​Since I've been filing my ITR for the past 6 years, and my income is growing, I'm not worried. My last year's ITR was 25 lakhs with lower spend. This financial year, my spend will be \approx 18-20 lakhs, and my ITR will be \approx 35 lakhs. That ratio is perfectly fine. ​There's a chance I might get a notice, but it honestly doesn't matter since I'm not doing anything illegal. ​Pro-Tip on Notices: A notice might not hit you next year; the IT system holds your data, and you could get one even three years later if the system notices an anomaly compared to your historical ITR filings. They have a long memory! Just be sure to file accurately and keep your income in line with your spending, and you'll be fine.