The government has announced a new rule to prevent people from making
multiple cash deposits in their bank accounts without quoting the PAN.
Till now, the limit for cash deposit without PAN was Rs 50,000 per
transaction. A lot of people were depositing less than Rs 50,000 per day
to escape the PAN provision. But a circular issued on Tuesday says
deposits made between 9 Nov and 30 Dec 2016 will require a PAN if the
combined sum exceeds Rs 2.5 lakh. This clarifies the misconception that
one can deposit cash in multiple batches of less than Rs 50,000 each and
escape mentioning the PAN.
The CBDT has also made changes in the (AIR) Annual Information Return
rules. Till now, banks and post office branches were supposed to report
to the tax department if an individual made cash deposits of Rs 10 lakh
in a year. During the period 9 November to 30 December, this limit has
been lowered to Rs 2.5 lakh.If the cash deposits exceed this limit, the
bank or post office will automatically report it to the tax department.
For current accounts, the threshold limit for cash deposits between 9
November and 30 December will be Rs 12.5 lakh.
The rule applies to all bank accounts of the individual, though it is
not clear how banks will be able to capture information of cash
deposited in other bank accounts.
Source : The Economic Times
