Supreme Court Ruling on Cash Transactions Involving ₹2 Lakh or More
The Supreme Court has issued a directive requiring courts to inform jurisdictional income tax authorities if cases before them involve cash transactions of ₹2 lakh or more.
Key Directives
- Courts must notify tax authorities about any case involving cash transactions of ₹2 lakh or more.
- Sub-registrars are required to report cash payments of ₹2 lakh or more in property registration documents to the income tax department.
Implications for Income Tax Authorities
- Upon notification, the income tax department must investigate the legality of the cash transaction.
- Transactions violating Section 269ST, which restricts cash receipts of ₹2 lakh or more, will be scrutinized.
Legal Consequences
- Section 271DA mandates penalties equal to the cash amount received in violations.
- The ruling aims to deter large cash transactions and promote a digital, transparent economy.
Broader Economic Context
- The government supports cashless transactions through digital payment initiatives and tax measures.
- The Supreme Court's ruling aligns with legislative efforts promoting a cashless economy.
Judicial and Administrative Compliance
- Failure to report eligible transactions by registration authorities will result in disciplinary actions.
- Judgment copies sent to relevant authorities for compliance and enforcement.
