Total Ban on Cash Transactions above Rs. 3 lac & to impose Cash Holding Limit of Rs. 15 lac: Recommendations of SIT on Black Money as Contained in the Fifth SIT Report
The SIT on Black Money has submitted it’s Fifth Report to Hon’ble SC and has mainly made two recommendations, i.e. i) total ban on cash transactions above Rs. 3 Lac and ii) fixing of upper limit at Rs. 15 lac for cash holding, as under:
Ban on cash transactions above Rs. 3,00,000
The SIT has felt that large amount of unaccounted wealth is stored and used in form of cash. 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. Thus, the SIT has recommended that there should be a total ban on cash transactions above Rs. 3,00,000 and an Act be framed to declare such transactions as illegal and punishable under law.
Upper limit of Rs. 15 lakhs on cash holding
The SIT has further felt that, given the fact of unaccounted wealth being held in cash which are further confirmed by huge cash recoveries in numerous enforcement actions by law enforcement agencies from time to time, the above limit of cash transaction can only succeed if there is a limitation on cash holding, as suggested in its previous reports. SIT has suggested an upper limit of Rs. 15 lakhs on cash holding. Further, stating that in case any person or industry requires holding more cash, it may obtain necessary permission from the Commissioner of Income tax of the area.
Suggestions are invited on the above recommendations of SIT at email@example.com