CBDT clarifies Rule114E of Income Tax Rules, says transactions of over Rs 2 lakh require to be reported

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New Delhi | Updated: December 23, 2016 4:19:33 PM

Central Board of Direct Tax (CBDT), today, notified that any businesses and traders receiving cash worth more than Rs 2 lakh in any single transaction for the sale of goods and services will have to send reports of it to the authorities.

The clarification on the reporting guidelines came into action from April, 2016, amid doubts about reporting of cash transactions that aggregate to Rs 2 lakh.The clarification on the reporting guidelines came into action from April, 2016, amid doubts about reporting of cash transactions that aggregate to Rs 2 lakh.

Issuing clarification regarding reporting of cash transactions under Rule 114 E of Income-tax Rules, 1962, the Central Board of Direct Tax (CBDT), today, notified that any businesses and traders receiving cash worth more than Rs 2 lakh in any single transaction for the sale of goods and services will have to send reports of it to the authorities. The clarification on the reporting guidelines came into action from April, 2016, amid doubts about reporting of cash transactions that aggregate to Rs 2 lakh.

In a statement released today, CBDT said, “The norms of aggregation contained in sub-rule 3 of Rule 114 E have been amended vide CBDT notification dated October 6, 2016, clearly indicating that the said transactions did not require aggregation and the reporting requirement under SFT for this purpose is on receipt of cash payment exceeding rupees two lakh for sale of goods or services per transaction.”

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Rule 114 E of Income-Tax Rules, 1962, for furnishing Statement of Financial Transactions (SFT) came into force with effect from April 1, 2016, under which a person is required to furnish a statement in respect of transaction relating to receipt of cash payment exceeding Rs 2 lakh for sale of goods or service.

(With inputs from agencies)

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