Revenue Secretary Dr Hasmukh Adhia tweeted on 21.03.2017 that In the official amendment to Finance Bill 2017 Govt has proposed that limit of 3 lakhs for cash transaction, beyond which it is illegal, be reduced to 2 lakhs. The penalty for violating this is a fine equivalent to the amount of transaction.
Screen Shot of Tweet by Revenue Secretary Dr Hasmukh Adhia
Budget Provision Proposed in above regard are as follows :-
It was proposed to insert section 269ST in the Act to provide that no person shall receive an amount of three lakh (Now proposed to be Rs. 2 Lakh) rupees or more,—
(a) in aggregate from a person in a day;
(b) in respect of a single transaction; or
(c) in respect of transactions relating to one event or occasion from a person,
otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account.
It was further proposed to provide that the said restriction shall not apply to Government, any banking company, post office savings bank or co-operative bank. Further, it is proposed that such other persons or class of persons or receipts may be notified by the Central Government, for reasons to be recorded in writing, on whom the proposed restriction on cash transactions shall not apply. Transactions of the nature referred to in section 269SS are proposed to be excluded from the scope of the said section.
It was also proposed to insert new section 271DA in the Act to provide for levy of penalty on a person who receives a sum in contravention of the provisions of the proposed section 269ST. The penalty is proposed to be a sum equal to the amount of such receipt. The said penalty shall however not be levied if the person proves that there were good and sufficient reasons for such contravention. It is also proposed that any such penalty shall be levied by the Joint Commissioner.