Compliance burden are substantially increased by latest notified Prevention of Money-laundering (Maintenance of Records) Amendment Rules, 2023

1. New Definition  are inserted/substituted under Sub-rule 2

 “(cba) “group" shall have the same meaning assigned to it in clause (e) of sub-section (9) of section 286 of the Income-tax Act,1961 (43 of 1961); 

“(cf) “Non-profit organization” means any entity or organisation, constituted for religious or charitable purposes referred to in clause (15) of section 2 of the Income-tax Act, 1961 (43 of 1961), that is registered as a trust or a society under the Societies Registration Act, 1860 (21 of 1860) or any similar State legislation or a Company registered under the section 8 of the Companies Act, 2013 (18 of 2013);” 

“(db) “Politically Exposed Persons” (PEPs) are individuals who have been entrusted with prominent public functions by a foreign country, including the heads of States or Governments, senior politicians, senior government or judicial or military officers, senior executives of state-owned corporations and important political party officials;”. Prevention of Money-laundering (Maintenance of Records) Amendment Rules, 2023

2. “(3A) Implementation of policies by groups. – Groups are required to implement group-wide policies for the purpose of discharging obligations under the provisions of Chapter IV of the Prevention of Money-laundering Act, 2002 (15 of 2003).”.

3. Compliance/due diligence by Bank and financial institution  are increased

A. Earlier the "Controlling ownership interest" means ownership of or entitlement to more than 25% of shares or capital or profits of the company. Now it will be more than 10% per cent. of shares or capital or profits of the company.

B. Earlier for the trust, the identification of beneficial owner(s) shall include 'identification of the author of the trust, the trustee, the beneficiaries with 15% or more interest in the trust and any other natural person exercising ultimate effective control over the trust through a chain of control or ownership. Now it will be more than 10% per cent. 

4.  New sub-rules are inserted, namely:- 
“(9A) Every Banking Company or Financial Institution or intermediary, as the case may be, shall register the details of a client, in case of client being a non-profit organisation, on the DARPAN Portal of NITI Aayog, if not already registered, and maintain such registration records for a period of five years after the business relationship between a client and a reporting entity has ended or the account has been closed, whichever is later.

(9B) Where the client has submitted any documents for the purpose of sub-rule (1), it shall submit to the reporting entity any update of such documents, for the purpose of updating the records mentioned under sub-rules (4),(5),(6),(7),(8) or (9), as the case may be, within 30 days of such updation.” 


Comments

Post a Comment

Popular posts from this blog

Case law (SC) -- SLP dismissed against order of High Court where notice u/s 148 was quashed stating that notice u/s 148 must comply with the Faceless Scheme regardless of the Assessee being a NRI/Indian Citizen.

ADIT (INT TAXN) 2 HYD & ANR. v. DEEPANJAN ROY[SLP (CIVIL) No. 33956/2025 dated 16.07.2025]  "1. Delay condoned. 2. Exemption Application is allowed. 3. Having heard the learned counsel appearing for the petitioners – Revenue and having gone through the materials on record, we find no good reason to interfere with  the impugned order passed by the High Court. 3. The Special Leave Petition is, accordingly, dismissed. 4. Pending applications, if any, shall also stand disposed of. "  
Read more

Case law (SC) - Once the Resolution Plan is approved by the NCLT, All the dues including the statutory dues owed to the Central Government, if not a part of the Resolution Plan, shall stand extinguished and no proceedings could be continued in respect of such dues for the period prior to the date on which the adjudicating authority grants its approval under Section 31 of the IB Code.

Vaibhav Goel & Anr. v. Deputy Commissioner of Income Tax & Anr. [2025 INSC 375] dated 20.03.2024 "8. In view o f the declaration of law made by this Court, all the dues including the statutory dues owed to the Central Government, if not a part of the Resolution Plan, shall stand extinguished and no proceedings could be continued in respect of such dues for the period prior to the date on which the adjudicating authority grants its approval under Section 31 of the IB Code. In this case, the income tax dues of the CD for the assessment years 2012-13 and 2013-14 were not part of the approved Resolution Plan. Therefore, in view of sub-section (1) of Section 31, as interpreted by this Court in the above decision, the dues of the first respondent owed by the CD for the assessment years 2012-13 and 2013-14 stand extinguished.  9. We may note here that the decision of this Court in the case of Ghanashyam Mishra and Sons Pvt. Ltd.[(2021) 9 SCC 657 ]  was specifically relied upo...
Read more

Case Law (SC) - Where an assessee is entitled to deduction u/s 80HHC as well as 80IA, the deductions have to be computed separately, but the total deduction shall be restricted to gross total income computed under section 80IA.

Shital Fibers Limited v. CIT [2025 INSC 743] dated 20.05.2025 Issue :- The extent of deduction allowable separately under Section 80-IA and Section 80-HHC and the extent of deduction allowable through each provision and overall deduction allowable by adding them up. Holding "Section 80-HHC provides for a deduction in respect of profits retained for export business. The provision is applicable to a company or a person engaged in business of export out of India of any goods or mercantile to which the Section applies. In computing the total income, the assessee is entitled to deduction to the extent of percentage of profits set out in Subsection (1B) of Section 80-HHC.  17. Section 80-IA deals with deductions in respect of profits and gains from industrial undertakings or enterprises engaged in infrastructure development etc. Sub-section (1) provides that when the gross total income of an assessee includes any profits and gains derived by an undertaking or an enterprise from any busi...
Read more