Finance Bill 2017: Govt proposes lower cap on cash transactions at Rs 2 lakh

In a bid to make the country go digital and cashless, the government has passed a new proposal to lower the curb on cash transactions. 

The government, in the Finance Bill 2017, has proposed to lower the limit on cash transactions to Rs 2 lakh from the Rs 3 lakh proposed in the Budget earlier this year.

At the time, Finance Minister Arun Jaitley, while announcing the curb on cash transactions had said that anyone found engaging in transactions above Rs 3 lakh would be penalised with an amount equal to the value of the transaction.

Tweeting about the new proposal, Revenue Secretary Hasmukh Adhia said

1/2 In the official amend.to FBill Govt has proposed that limit of 3 lakhs for cash tranx,beyond which it is illegal, be reduced to 2 lakhs

— Dr Hasmukh Adhia (@adhia03) March 21, 2017

2/2 The penalty for violating this is a fine equivalent to the amount of transaction

— Dr Hasmukh Adhia (@adhia03) March 21, 2017

This means, cash transactions above the limit of Rs 2 lakh would be deemed illegal and a fine equivalent to the amount of transaction would be levied.