23 March 2017 Current Affairs: The Government of India has proposed to lower the limit of cash transaction from Rs. 3 lakh to Rs. 2 lakh per month to further tighten and discourage payments by cash as well as curb black money.
The Union Finance Minister Arun Jaitley proposed 40 amendments to the Finance Bill 2017 which was cleared by the Lok Sabha on March 21, 2017.
The new limit will be effective from April 1, 2017. Any violations to the norms would be subjected to a fine equivalent to the amount of transaction. For example, if a cash transaction of Rs 4 lakh is uncovered, the penalty will be Rs 4 lakh.
The decision to cap the cash transaction to Rs. 2 lakh was taken based on a report that after a sudden increase, the digital transactions had again declined.
Among other amendments, the Minister proposed to make Aadhaar mandatory for filing tax returns from July 1. Besides, Aadhaar has also been made mandatory to apply for permanent account numbers (PAN).
The government also proposed to amend the Finance Bill to ensure only cheque payments can be accepted for the purchase of electoral bonds and that RBI is empowered to authorise banks to accept them.
The amendments to the laws like Companies Act, Employees Provident Fund, Smuggling and Foreign Exchange Act, TRAI Act and Information Technology Act, have also been proposed to make the functioning of tribunals more efficient by merging the smaller ones and reducing their numbers from 40 to 12.