In a fresh statement made by Income Tax Department, it has warned people against getting indulged in a cash transaction of Rs. 2 Lakh or more. The department also warned that the receiver will also be imposed an equal amount of penalty in such a case. With this, the department also advised people to complain of any such dealings by emailing at ‘blackmoneyinfo@incometax.gov.in’. This is to be noted here that the government has banned cash transaction of Rs. 2 Lakh or more from April 1, 2017, through the Finance Act 2017. This is under the new section 269ST of income tax act which says that cash dealing on a single day for a single transaction for an event or occasion should not be more than 2 lakh.
In the financial budget of 2017-18, the Finance Minister Arun Jaitley proposed for banning cash transaction of more than 3 Lakh in a day, later with an amendment the limit was reduced to Rs. 2 lakhs. The tax department further mentioned that this restriction is not for any receipt by the government, banking company, post office savings bank or co-operative bank. After the demonetization in November 2016, the department had started the email address ‘blackmoneyinfo@incometax.gov.in’, to fight against corruption and black money.
Post demonetization it has been found that people with unaccounted wealth had illegally converted their black money held in old notes to new 500 and 2,000 rupee notes, to stop such actions the department launched the email id. Pradhan Mantri Garib Kalyan Yojna (PMGKY) is a tax amnesty scheme under which, the people who have unaccounted cash could come out clean by declaring their wealth and by paying 50% of it as tax and penalty. It can be called the effect of demonetization or the urge of government to stop the flow of black money in the market, but whatever it is, this is surely going to hamper the ordinary man.
This article is provided by NRI Tax Service Company. NRITAXSERVICE.COM, a firm of professionals, set up with its Head Office in New Delhi, India and associate offices across India.