The Delhi High Court directed the Ministry of Finance to constitute a committee to decide whether payment gateway service providers be classified as payment system operator. The Court heard an appeal by PayPal against the Financial Intelligence Unit's decision (FIU) imposing a penalty of Rs 96 lakh on it for not registering itself as a payment system operator' under the Prevention of Money Laundering Act, 2002. PayPal contended that since the RBI has not licensed it as a payment system operator. It is a mere intermediary in a payment system and does not need to register itself under the PMLA, 2002. Bench constituting Justice Pratibha M Singh stayed the order of FIU on January 12 and instructed the Ministry of Finance committee to submit its report by May 20.
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