Purchase of jewellery exceeding Rs 50,000 won’t require the income tax permanent account number (PAN) or Aadhaar Card to be provided after the government reversed an earlier notification on Friday, providing a big festive cheer for the sector and potential customers.

Ahead of the assembly elections in Gujarat, the government has removed gems and jewellery dealers from the purview of the reporting requirement under the Prevention of Money Laundering Act (PMLA). Also, government need not be informed on jewellery purchase of over Rs 50,000, which means that jewellers will not have to report data on buyers to Financial Intelligence Unit. Dealers in precious metals, precious stones and other high-value goods having a turnover of over Rs 2 crore in a financial year had been notified as persons carrying on designated business and professions under the Prevention of Money Laundering Act, (PMLA) 2002. This had made them reporting entities under the PMLA requiring them to intimate the relevant authorities about transactions above certain limits.

Dealers in precious metals, precious stones and other high-value goods having a turnover of over Rs 2 crore in a financial year had been notified as persons carrying on designated business and professions under the Prevention of Money Laundering Act, (PMLA) 2002. This had made them reporting entities under the PMLA requiring them to intimate the relevant authorities about transactions above certain limits.

With the festive season still under way, the withdrawal of the notification has raised prospects of sales recovering in the third quarter. Revenue Secretary Hasmukh Adhia said that there was a lot of misunderstanding about the notification and so that there is no panic in the market the government has decided to withdraw the notification. Under PMLA, all reporting entities, like banks, are required to report cash deposits over Rs 50,000.