Govt considering banning cash transactions over ₹3 lakh
FollowThe Government is examining the Supreme Court-appointed Special Investigation Team (SIT) recommendations to ban cash transactions of over ₹3 lakh, in a bid to clamp down on black money in the economy, Central Board of Direct Taxes (CBDT) Chairperson Rani Singh Nair said today.
The SIT on black money had also recommended restricting cash holding with individuals and industry to ₹15 lakh, to curb illegal wealth in the country.
“These recommendations have come. It (banning cash transactions over ₹ 3 lakh) is under examination. SIT recommendations are under consideration,” she told reporters on the sidelines of an Assocham event here.
The Income Tax Department, she said, has already put a 1% tax at source on cash transactions and made quoting of PAN mandatory.
“All these aspects are part of SIT recommendations to stop use of cash in the economy. Suggestion on ₹3 lakh and above is under consideration,” she said.
The SIT, headed by Justice M B Shah (retired), last month submitted its fifth report to the Supreme Court on steps needed to curb black money.
Noting that a large amount of unaccounted wealth is stored in cash, the SIT said: “Having considered the provisions which exist in this regard in various countries and also having considered various reports and observations of courts regarding cash transactions, the SIT felt that there is a need to put an upper limit to cash transactions.”
It recommended a total ban on cash transactions of ₹3 lakh and above and that “an Act be framed to declare such transactions as illegal and punishable under law“.
