CA Ashish Tater

Ashish TaterSection 269ST is introduced by Finance Act, 2017 with effect from 01.04.2017 and put a limit on Cash Transaction to put a check on Black Money and Tax Theft. Section is much talked about section as it provides penalty for any cash transaction above the value of Rs. 2 Lakh, equal to the Transaction amount. In this article author made an attempt to Analyse the section in Tabular manner for easy understanding of Readers:-

APPLICABLE FROM 01/04/2017
PROVISION OF SECTION 269ST No person shall receive an amount of two lakh rupees or more—

(a) in aggregate from a person in a day; or

(b) in respect of a single transaction; or

(c) in respect of transactions relating to one event or occasion from a person, otherwise than by an account payee cheque or an account payee bank draft or use of electronic clearing system through a bank account.

EXCEPTIONS (a) Government;

(b) any banking company, post office savings bank or co-operative bank;

(c) transactions of the nature referred to in section 269SS;

(d) such other persons or class of persons or receipts, which the Central Government may, by notification in the Official Gazette, specify.

PENALTY FOR NON COMPLIANCE SECTION 271DA If a person receives any sum in contravention of the provisions of section 269ST, he shall be liable to pay, by way of penalty, a sum equal to the amount of such receipt

Any penalty imposable under sub-section (1) shall be imposed by the Joint Commissioner.

ANALYSIS IN-DETAIL

APPLICABLE FROM
01/04/2017
APPLICABLE TO
Any person – Individual, HUF, Firm, LLP, Company, Trust…
TYPE OF RECEIPT
Any Receipt – Whether capital or revenue.
MAXIMUM CASH  RECEIPTS PERMISSIBLE
Below Rs. 2,00,000/-
PENALTY FOR CONTRAVENTION
100% of Amount Receipt
 EXAMPLES OF TRANSACTIONS COVERED
In aggregate from a person in a day
Cash Receipts on a Single Day
CUSTOMER
A
B
C
D
Bill 1
2,50,000/-
50,000/-
1,90,000/-
1,00,000/-
Bill 2
1,50,000/-
5,000/-
25,000/-
Bill 3
85,000/-
TOTAL
2,50,000/-
2,00,000/-
1,95,000/-
2,10,000/-
PENALTY
YES
YES
NO
YES
PENALTY AMT
2,50,000/-
2,00,000/-
NIL
2,10,000/-
Cash Withdrawal from bank on a Single Day
BANK
BANK A
BANK B
BANK C
Cash Withdrawal 1
50,000/-
1,95,000/-
1,00,000/-
Cash Withdrawal 2
1,50,000/-
1,10,000/-
TOTAL
2,00,000/-
1,95,000/-
2,10,000/-
PENALTY
YES
NO
YES
PENALTY AMT
2,00,000/-
NIL
2,10,000/-
Cash Receipt from Sale of Car [ Assuming Sale Value Rs. 4,00,000/- ]
PARTICULARS
CASE 1
CASE 2
CASE 3
Cash Receipts
4,00,000/-
2,00,000/-
1,00,000/-
Non-Cash Receipts
2,00,000/-
3,00,000/-
TOTAL
4,00,000/-
4,00,000/-
4,00,000/-
PENALTY
YES
YES
NO
PENALTY AMT
4,00,000/-
2,00,000/-
NIL
in respect of a single transaction
Payments received in Cash and Other than Cash
 
CUSTOMER
X
Y
Z
W
01/04/2017
Invoice Value
4,00,000/-
4,00,000/-
4,00,000/-
4,00,000/-
05/04/2017
Chq Pmt 1
1,00,000/-
1,00,000/-
1,50,000/-
2,00,000/-
10/04/2017
RTGS / NEFT
1,50,000/-
1,50,000/-
15/04/2017
Cash Pmt 1
50,000/-
1,00,000/-
70,000/-
75,000/-
20/04/2017
Cash Pmt 2
50,000/-
1,00,000/-
30,000/-
75,000/-
25/04/2017
Cash Pmt 3
50,000/-
1,00,000/-
50,000/-
 
TOTAL
4,00,000/-
4,00,000/-
4,00,000/-
4,00,000/-
 
TOTAL NON-CASH
2,50,000/-
1,00,000/-
3,00,000/-
2,00,000/-
 
TOTAL CASH
1,50,000/-
3,00,000/-
1,00,000/-
2,00,000/-
 
PENALTY
NO
YES
NO
YES
 
PENALTY AMT
NIL
3,00,000/-
NIL
2,00,000/-
in respect of transactions relating to one event or occasion from a person
IN CASE OF INDIVIDUAL (Occasion: Marriage or Any other Events)**
SITUATION
1
2
3
CASH FROM A
1,90,000/-
2,00,000/-
2,50,000/-
CASH FROM B
1,50,000/-
1,25,000/-
50,000/-
CASH FROM C
1,60,000/-
1,75,000/-
2,00,000/-
TOTAL CASH
5,00,000/-
5,00,000/-
5,00,000/-
PENALTY
NO
YES
YES
PENALTY AMT
NIL
2,00,000/-
4,50,000/-
** On plain reading of the provisions of the section, no person can receive cash of Rs. 2,00,000/- or more on one event or occasion from a person. In other words, the restriction is on per person per event / occasion.

DISCLAIMER: To the best of our knowledge, all information included here are true. We strive for accuracy but cannot be held responsible for any errors in the information featured herein or incorrect attributions. M/s. I. C. Tater & Co. & M/s. I. C. Tater & Associates do not represent or warrant that the information herein are complete or current and while we use reasonable efforts to include accurate and up to date information, we make no warranties or representations as to its accuracy. We assume no liability or responsibility for any errors or omissions in the content. We further assume no liability or responsibility for incurring any loss on relying on the information herein.

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Tags : Budget (1473) Budget 2017 (351) Section 269ST (21)

27 responses to “Section 269ST Basic Provisions as Per Income Tax Act”

  1. SURRINDHHARRAW says:

    Payments received in Cash and Other than Cash:

    AS PER THE GUIDELINES PER DAY CASH TRANSACTION LIMIT IS Rs. 2 LAC BUT IN THE ABOVE TABLE THERE IS A PENALTY OF AN AMOUNT BY 1 LAC IN 3 DIFFERENT DATES.

    15/04/2017

    Cash Pmt 1

    50,000/-

    1,00,000/-

    70,000/-

    75,000/-

    20/04/2017

    Cash Pmt 2

    50,000/-

    1,00,000/-

    30,000/-

    75,000/-

    25/04/2017

    Cash Pmt 3

    50,000/-

    1,00,000/-

    50,000/-

  2. sushil kumar agarwal says:

    i am a trader and in year i supply the goods to the same party in different dates and received the cash payment at out station in my bank and in a year it crosses the 2lacs , is s-269 st applicable

  3. Vishal says:

    If debtor deposit cash in traders account aginst sell bill then trader would attract any penalty

  4. B D SATYANARAYANA says:

    If an individual gets rent in cash every month and the total for the year exceeds 2 Lakhs but less then 3 Lakhs What would be tax implication Under Section 269 ST

    • K.s.rama krishna says:

      Sir,Iam take loan one person through cash cheque 3lacs
      I given a aadhar card to bank and iwill draw cash directly
      My doubt is any problem is face banker take aadhi card and given a cash tell my problem answer

  5. Arun says:

    Sir,
    Please clarify if a party(Retailer) purchase regularly from a wholesaler, all invoices are of below Rs. 1.90 lac in different dates. However the total invoice in the financial year is some Rs.3 lac, the payment are made in cash that too less then Rs. 10 thousend per day or as aginest invoice amount. In this case, there are no invoices on any single day are more than Rs. 1.5
    Lac, and no receipt of cash is more than Rs. 10 thousands in a single day. Is it permitted, or is it treated as on event, i.e., purchase of goods for sale. Please clarify.

    – See more at: http://taxguru.in/income-tax/section-269st-basic-provisions-income-tax-act.html#comment-1960543

  6. Arun says:

    Sir
    Myself is trader and i trade goods to the dealers to which we make invoice per day of some amounts 10000 / 20000 or vise versa and which are credit billing and we accept the cash against this bills after 15-20 days or minimum 7 days to which the total t’over for this dealer could exceed in a year 300000 and cash receipts for their invoices after a 7days period or 15-20 days .
    so just wanted to confirm that what would be status for multiple billing and multiple cash reciepts which are not getting cash for invoice same day or nor the 2lac transaction because some of unregistered dealers still giving cash payment against the invoice made .

  7. Prem Singh says:

    Sir please tell gst rate of selling used Ac, used fridge
    &other used old Eletronics goods

  8. CA R.VENGATACHALAM says:

    SINCE THE “AGGREGATE” WORD IS NOT THERE IN CLAUSE B & C , FURTHER ALL THE CLAUSE ARE INDEPENDENT SINCE “OR” IS MENTIONED .
    I AM HAVING DOUBT IN THE EXAMPLE OF CUSTOMER Y FOR CLAUSE B. AGGREGATING OF ALL ONE MAY NOT BE NECESSARY . PL CLARIFY

  9. Mohana says:

    What is the limit for Cash receipt per annum for the FY 2017-18 for a Private Ltd Company.

  10. Ravikumar says:

    Sir,
    Please clarify if a party(Retailer) purchase regularly from a wholesaler, all invoices are of below Rs. 2 lac in different dates. However the total invoice in the financial year is some Rs.25 lac, the payment are made in cash that too less then Rs. 2 lac per day or as aginest invoice amount. In this case, there are no invoices on any single day are more than Rs. 2Lac, and no receipt of cash is more than Rs. 2 lac in a single day. Is it permitted, or is it treated as on event, i.e., purchase of goods for sale. Please clarify.

  11. jayadev says:

    Cash Withdrawals from Bank are not covered under penalty provision as per the Press Release with regard to Cash Transactions

  12. Keerthi says:

    Very good interpretation. Very useful. Thanks

  13. Nurali says:

    More then 2 lac Rs will be deposited in the 3 various bank account if payment will be get in maximum 15000 from each person per day

  14. Ali says:

    More then 2 lac rupees will be deposite in bank accounts if firm have 3 bank accounts and fork will get payment from person in 10000 rupees from 1 person ??

  15. Kushal says:

    Reply to Babulal query

  16. sunil anand says:

    sir kindly reply on no 1 of mr Pritesh Thakkar and mr P V NARAYANA RAO as i have same inquiry

  17. Pritesh Thakkar says:

    sir in case of multiple bills if cash transaction does not exceed 2 lacs in a day but is more than 2 lacs in a financial year in such cases is it mandatory to provide pan details and buyers details to the income tax department?

    • P V NARAYANA RAO says:

      sir
      (1) IF DIFFERENT PARTIES ARE SOLD GOODS WORTH LESS THAN RS.2 LAKHS EACH ON CASH BASIS ON A SINGLE DAY TOTALING TO RS.6 LAKHS,
      (2) IF THE SAME PARTY IS SOLD GOODS WORTH RS.1.5 LAKHS EVERY DAY & THE CASH PAYMENT IS RECEIVED ON THE FOLLOWING DAY NOT EXCEEDING RS.2 LAKHS .

      R THEY LIABLE FOR PENALTY U/S 271DA.?

      PLS CLARIFY

    • babulal says:

      Sir please clarify if every day cash sales is more than 5 lakh a day with different unidentifiable parties and all bills are small amount between 5000 to 20000 then the above provision is applicable or not. and whether customer name is mandatory on invoice copy or not.

    • thiruvayu Kumar says:

      No. Quoting of pan is mandatory only when each invoice value exceeds 2 lacs

  18. Pankaj says:

    Can cash sale exceed more than 2lakhs per day from individuals party

  19. GANDHI MOHAN BHARATI says:

    I think that it came out in Tax Guru that cash withdrawl from bank by anyone for Rs.2.00 lakhs or more will not attract penalty.
    Please clarify

  20. CAKAILASH GOYAL says:

    THE PROVISION NOT APPLICABE FOR WITHDRAWAL FROM BANK AS CLARIFIED BY CBDT PLEASE CONFIRM

    • ASHISH TATER says:

      Yes. Section 269 ST Not Applicable in case of withdrawl from bank. The table was not removed while updating the article. My apology.

  21. SEKAR says:

    Highly informative for many persons to know/study the developments in the field of IT tabulations. NICE

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