On Wednesday, Income tax department announced that ban on cash transaction over Rs. 2 lakh is not valid in banks and post offices.
As per the Finance Act 2017, cash transaction of more than Rs 2 lakh will attract the penalty of an equal amount from the receiver of the amount.
Now as per the new amendment in the act, it is said by Central Board of Direct Taxes that limit is not applicable if withdrawal is made from banks and post offices.
As per the rule, one cannot deal in cash in more than of Rs 2 lakh on a single day in a single transaction.
Finance minister Arun Jaitley had projected to limit cash transaction of over Rs 3 lakh in 2017-18 Budget and later it was made to Rs. 2 lakh after amendment made in finance bill. It was passed in Lok Sabha in the previous month.