NEW DELHI: The government on Wednesday announced another important step in its fight against black money and corruption. Presenting the Union Budget 2017, Union Finance Minister Arun Jaitley on Wednesday proposed to ban all cash transactions above Rs 3 lakh beginning April 1, 2017.
The decision to ban cash transactions beyond a threshold is based on the recommendation of the Special Investigation Team on black money that was set up by the Supreme Court, Jaitley said.
The SIT, headed by Justice MB Shah (retired), in July had submitted its fifth report to the Supreme Court on steps needed to curb black money.
Noting that a large amount of unaccounted wealth is stored in cash, SIT had said: “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.”
It recommended a total ban on cash transactions of Rs 3 lakh and above and that “an Act be framed to declare such transactions as illegal and punishable under law”.
On November 8 last year, the government had announced the decision to demonetise high currency notes of Rs 500 and Rs 1000 to fight black money.