The Indian Government has said that a steep penalty awaits those accepting cash in excess of Rs 3 lakh, beginning April 1, to settle any transaction.
Commenting on the issue, Revenue Secretary Hasmukh Adhia told the media, "The penalty for doing cash transaction will be steep and the receiver will have to pay an amount equivalent to the cash received."
"Supposing you do a transaction of Rs 4 lakh in cash, then the penalty would be Rs 4 lakh. If you do a transaction of Rs 50 lakh, penalty would be Rs 50 lakh," he added.
The government, he said, will track all large cash transactions, and also curb the avenues of conspicuous consumption through cash.
As per reports, people with large sum of unaccounted money usually spend it on holidaying or buying luxury items like cars, watches and jewellery. The new cash curbs will mean that such spending avenues are curtailed, disincentivising people from generating black money.