The Government has made linking of Aadhaar Card mandatory for opening bank accounts as well as for every financial transactions of Rs. 50,000/- and above.
The Government has also asked the existing bank account holders to furnish their Aadhaar details by December 31st, 2017.
The Notification issued by the Revenue department recently stated that the account holders, who fails to submit the above details before the deadline will be barred from operating the accounts.
The Finance Act, 2017 has already mandated seeding of Aadhaar number with Permanent Account Number to avoid individuals using multiple PANs to evade taxes by inserting a new section 139AA of the Act. the provision has been recently upheld by the Supreme Court with a specific finding that it is necessary to remove fake PAN Cards.
The notification issued amending the Prevention of Money-laundering (Maintenance of Records) Rules, 2005, mandated quoting of Aadhaar along with PAN or Form 60 by individuals, companies and partnership firms for all financial transactions of Rs 50,000 or above.
Tightening the rules for small accounts, which can be opened without having officially valid KYC documents, the amendment said such accounts – which can have maximum deposit of Rs 50,000, can be opened only at bank branches which have core banking solution.
It can also be opened at a branch where it is possible to manually monitor and ensure that foreign remittance are not credited to such account and stipulated limits on monthly and annual aggregate of transactions and balance are not breached, the amended PMLA rules said. Such small account shall remain operational initially fora period of 12 months and thereafter for a similar period if the account holder provides evidence that he or she has applied for officially valid identification documents.
it is stated in the Notification that “the small account shall be monitored and when there is a suspicion of money laundering or financing of terrorism or other high risk scenarios, the identity of claim shall be established through the production of official valid documents.”
The amendment makes it mandatory for individuals, companies and partnership firms to quote Aadhaar along with PAN or Form 60 for all financial transactions of Rs 50,000 or above with effect from June 1.
Post June 1 if a person does not have an Aadhaar number at the time of opening of account, then he has to furnish proof of application of enrolment for Aadhaar and submit the Aadhaar number to the bank within six months of opening of the bank account.
“In case the client, eligible to be enrolled for Aadhaar and obtain a PAN does not submit the Aadhaar number or the PAN at the time of commencement of an account based relationship with a reporting entity, the client shall submit the same within a period of 6 months from the date ofthe commencement of the account based relationship.
“Provided that the clients already having an account based relationship with reporting entities prior to date of this notification, the client shall submit the Aadhaar number and PAN by December 31, 2017,” the notification said.
So far, as per the PMLA Rules it is mandatory to provide PAN number or Form 60 to banks while opening of accounts or for high value transactions.
For companies opening bank accounts, Aadhaar number of managers, or employees holding an attorney to transact on the company’s behalf will have to be provided.
