Guwahati: The directorate general audit, Kolkata zonal unit, along with Shillong audit commissionerate, on Thursday laid down some guidelines for traders dealing with precious stones and metals in the city to put an end to money laundering activities.
These guidelines come into effect under the Prevention of Money Laundering Act (PMLA) 2002 and the PMLA (Maintenance of record) Rules 2005 for dealers, who are part of any reporting entity and are not covered under Section 51(A) of the Unlawful Activities (Prevention) Act 1967 and Section 12(A) of the Weapons of Mass Destruction and Their Delivery Systems (Prohibition of Unlawful Activities) Act 2005.
An officer in Central Bureau of Indirect Taxes and Customs (CBIC) said, “It is important to make these dealers aware. With this outreach program, aim to establish a proper mechanism among them. Money laundering (ML) activity leads to terrorist financing (TF) and also hampers the economy of the state.”
This comes after Financial Action Task Force (FATF), a French anti-money laundering authority, earlier this month in its report mentioned that precious metals and stones like gold, silver, diamond and ruby, were still a leeway for large scale transactions obscuring ownership and source of fund in India.
These guidelines are meant to be followed by traders, who are engaged in cash transactions of Rs 10 lakh or above. According to Section 269ST of Income Tax Act 1961, no trader shall receive an amount equal to or above Rs 2 lakh. If found in violation of this section, they will be liable to pay a penalty equivalent to the amount received in cash. However, traders are allowed to make payments of such amounts if they have registered themselves with Financial Intelligence Unit (FIC), India.
The traders of the reporting entity under this guideline must register the details of a client or the company, firm or trusts he or she has, and in times of need must furnish details of any suspicious transactions to the FIC.
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