1.75 lakh of entities withdrew on Rs 1cr each of A/cs in 1 year

NEW DELHI: More than 1.75 Lakh entities withdrew more than 1 crore of Rs 1 each from their bank accounts in 2017-18, adding Rs 11 lakh crore, which prompted the government to impose checks for better tracking and reduction of transactions cash.

Although some of the withdrawals were due to genuine business needs, including cash management companies that run ATMs, sources said the 2017-18 data also yielded several examples of what they believed was the money intended to be used. for illicit purposes. In a large number of cases, the supplied PAN was incorrect or not shared at all.

Through the proposed tax deduction of 2% in origin, the government expects to improve the monitoring of entities that withdraw large amounts of cash, since the entities that withdraw money will deliver their correct PAN to claim the adjustment at the time of the payment of the advanced tax.

The sources said there were more than one lakh of PAN holders who withdrew Rs 1-2 in cash during 2017-2018, while there were about 500 entities that withdrew more than Rs 100 million from their bank accounts. Almost half of the cash withdrawals during 2017-18 were from accounts where the annual amount withdrawn was more than 100 million rupees.

The government collects data from all current accounts that have annual cash withdrawals of Rs 50 lakh or more, while banks also report data from some savings bank accounts.

The idea is to move to an economy with less cash and this is a step in that direction. Most companies do not need to have large cash transactions, said a TOI tax official.

In the budget, minister of finance. Nirmala Sitharaman He also proposed that entities with an annual turnover of more than 50 rupees provide digital payment tools such as UPI based on QR codes, credit cards, NEFT and RTGS where there is no burden for the consumer or the merchant.

Over the next few weeks, the Reserve Bank of India is expected to resolve the details so that banks protect consumers and merchants in the same way they are doing for RTGS and NEFT Transactions , which have now been made free to account holders who use the two facilities to transfer money electronically to other accounts.