Revenue Secretary Hasmukh Adhia on Tuesday said the Centre’s Finance Bill has proposed lowering the limit for cash transactions from Rs 3 lakh to Rs 2 lakh. On Twitter, he said the penalty for violating the restriction would be a fine equivalent to the amount. The cap will come into force once the Bill receives the president’s assent, which is expected to happen on Wednesday, mint reported.

On February 5, Adhia had said businesses or vendors accepting cash in excess of Rs 3 lakh will have to pay a 100% penalty starting April 1. “Supposing you conduct a transaction of Rs 4 lakh in cash, then the penalty will be Rs 4 lakh. If you do a transaction of Rs 50 lakh, the penalty will be Rs 50 lakh,” he had explained. The restrictions were not applicable to government banks, post office savings banks or co-operative banks, he had said.

In the 2017-18 Budget, Finance Minister Arun Jaitley had proposed inserting Section 269ST in the Income Tax Act, seeking to bar individuals from receiving more than Rs 3 lakh in cash in a day. The move to limit cash transactions in India began after Prime Minister Narendra Modi announced the demonetisation drive on November 8 last year.