Key Points
Further, when does KYC rules for buying gold jewellery kick-in under the PMLA Act..
Jewellers have been made reporting entities under the Act which requires them to comply with KYC norms (i.e., asking for PAN or Aadhaar of the purchaser for cash transactions above specified limit) as well as report large value cash transactions i.e. of Rs 10 lakh and above to the government...
Section 269ST of the Income Tax Act, 1961, prohibits cash transactions exceeding Rs 2 lakh in a single day, in aggregate from a person in a day or in respect of transactions relating to one event or occasion from a person..
Stuti Galiya, Partner of law firm Khaitan & Co says, Furnishing PAN details for gold purchase is mandatory for transactions valued at Rs. 2 lakh and above under Rule 114B of the Income Tax Rules of 1962..
From a practical perspective, jewellers not receiving cash of more than Rs 2 lakh from a single person when selling gold jewellery are in compliance with the existing provisions of the Income Tax Act and will not be covered under the December 2020 PMLA notification (unless where the jeweller believes the transaction to be suspicious)..
