Only purchase of jewellery above Rs 2 lakh needs mandatory KYC

TIL Desk/Business/New Delhi/ Department of Revenue (DoR) has clarified that any purchase of gold, silver, jewellery or precious gems and stones below Rs 2 lakh does not require PAN or Aadhaar of a customer as a mandatory KYC document.

Sources said that the notification issued under (Prevention of Money Laundering) PML Act, 2002, on December 28, 2020 is a requirement of FATF Dealers in Precious Metals and Precious Stones (DPMS) to carry out KYC and Customer Due Diligence only when they conduct cash transactions above Rs 10 lakh.

This is a requirement of FATF (Financial Action Task Force) – the global money laundering and terrorist financing overseer which as the inter-governmental body sets international standards aimed to prevent illegal activities on terror funding and money laundering.

One of the recommendations requires DPMS sector to fulfil obligations of Customer Due Diligence (CDD) when they conduct cash transactions above a certain limit (USD/EUR 15,000). India is a member of FATF since 2010. DoR sources said the contention that any purchase, even if below Rs 2 lakh, of gold, silver, jewellery or precious gems and stones in cash require KYC are baseless.