India To Charge 100% Penalty On Cash Transaction Above Rs 3 Lakh
Indian Revenue Secretary Hasmukh Adhia said from April 1 cash transaction of more than Rs 3 lakh has been banned and those who don’t follow it will be to face penalty of 100 percent.
Giving an interview to Press Trust of India (PTI) he added if the cash transaction is Rs 50 lakh the penalty will be same Rs 50 lakh and if the transaction is Rs 4 lakh the penalty will be Rs 4 lakh too.
Adhia further explained if a person buys an expensive watch for cash, the shopkeeper will be entitled to pay the tax.
The ban on cash transaction of over Rs 3 lakh is proposed in the Union Budget for 2017-18. This is a major step to curb black money generation.
The demonetization period that started on November 8 last year has brought to account stock of black money and the government is further planning for policies to stop further generation of the same.
Adhia added further the PAN mandatory feature above cash transaction of Rs 2 lakh that was previously notified will continue.
The cash transaction limit up to Rs 3 lakh however does not implies to any banking company, the government, co-operative bank or post office savings bank.
Indian Finance Minister Arun Jaitley proposed to insert 169ST in the Income-Tax Act in his Budget for 2017-18 and which reads, “no person shall receive an amount of Rs 3 lakh or more by way of cash in aggregate from a person in a day; in respect of a single transaction; or in respect of transactions relating to one event or occasion from a person.”