The Central Board of Direct Taxes (CBDT) informed that all companies or business entities with a business volume of ₹ 50 crore or more annually must provide facilities and accept payments through digital transactions. The regulation was introduced through Section 269SU of the Income Tax Act, a new section with effect from January 1st, 2020. Section 269SU shall be part of the Finance Act 2019. Non-compliance of this regulation shall lead to a fine of ₹ 5,000 per day. The fine will be effective from 1st February 2020 and would be initiated through the rules as informed in Section 271DB. The regulation was introduced through the circular no-32/2019 on 30th December 2019.
Page Contents
- Prescribed Electronic Modes of Payment under Section 269SU
- Instructions to the Bank related to electronic mode prescribed under Section 269SU
- Key Points of Section 269SU
- Applicability of Section 269SU
- Effective Date of Enforcement Provisions of Section 269SU
- Implication & Modes of Payment Under Section 269SU
- Consequence Of Non Compliance Of Section 269SU
Prescribed Electronic Modes of Payment under Section 269SU
Every person with a business turnover of more than ₹ 50 crore during the immediately preceding previous year have to mandatorily provide all the following modes for the purpose of acceptance of payment, which is in addition to the facility for other electronic modes of payment, if any, being provided by such person:
- Debit Card powered by RuPay
- Unified Payments Interface (UPI) (BHIM-UPI)
- Unified Payments Interface Quick Response Code (UPI QR Code) (BHIM-UPI QR Code)
Section 10A of the Payment and Settlement Systems Act, 2007 which was inserted by the Finance Act provides that no bank or system provider shall impose and charge including Merchant Discount Rate (MDR) on a payer, or a beneficiary receiving payment, through electronic mode prescribed under Section 269SU of the Act.
Key Points of Section 269SU
Summary – 269SU
Applicability of Section 269SU
√ Applies to every person
√ carrying on business and
√ turnover of the business exceeds ₹ 50 crore during the immediately preceding previous year
Effective Date of Enforcement Provisions of Section 269SU
√ This section came in to effect from 01-01-2020 and to equip yourself time has given up to 31-01-2020.
Implication & Modes of Payment Under Section 269SU
Such business has to provide facility for accepting payment through following electronic modes, in addition to the facility for other electronic modes of payments.
Such modes of payments are notified vide notification no. 105/2019 of CBDT dated 30th Dec-2019 are as follows:
√ Debit Card powered by RuPay
√ Unified Payments Interface (UPI) (BHIM-UPI)
√ Unified Payments Interface Quick Response Code (UPI QR Code) (BHIM-UPI QR Code)
Consequence Of Non Compliance Of Section 269SU
Penalty of ₹ 5,000/- per day and will be effective from 01-02-2020 under section 271DB for failure to comply with provisions of section 269SU.
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One of my client is in trading business of Coal and having TO exceed 50Crore. He receives all payments through RTGS/NEFT. and most of the payment is more then 50lacs or 1 crore. is it require them to take QR code. no one will use QR code for this big payments. kindly advice.
Dear Sir
I am equity stock trader (derivative segment) and my turnover is less than 50 cr and audited as under section 44AB. I received intimation from IT dept to provide for accepting payments thro electronic modes u/s 269SU. My CA is not clear if I need to provide these facilities. I have activated UPI & UPI QR code for my Bank account. Please confirm if I am covered us 269 SU and if yes how to get mode tp receive payment through Debit card powered Rupay.
I would appreciate your help on this issue.
Regards
Pankaj
Is it necessary to Add BHIM upi or BHIM upi QR code on the Invoice. or the Printing of Bank Details like (Account No. and IFSC code) will Comply the Provisions?
Sir, whom to contact whether Bankers or other agencies for installation of the prescribed electronic mode in the promises.
Partnership firm into share trading, f & o and online commoditii trading is also require to give such facility, where they do all these activities in their name and all payments allowed through RTGS OR NEFT, and no customer kind of situation. So, 269SU is applicable to firm also ?
What is meant by “Debit Card powered by RuPay” —
If i have a Debit Card and is haveing account particulars of the company, i can pay. Then what is that need to provided by the Company with Turnover of more than 50 crores
Whether installation of Third party UPI App like SBI BHIM would tantamount to compliance to above reqmt. OR we have to install direct BHIM App and register as a merchant..?
Sir , whether we can accept more than Rs 10000 in cash on Bank holiday or bank strike or the section 269SU restrict it???
Sir,
Companies turnover exceeds Rs 50 Cr but all the payments are bring received through cheque . So in this case whether sec 296SU is applicable.
Whether B2B transactions are covered under Sec 269SU?
And procedure to response to notice under this section
We are manufacturer in jewellery Business
Is it applicable on Banks, if yes than what is it’s impact on a bank ( Holding Office outside India & Sub. working in India) and customers.
Dear sir,
what are the exceptions of this section.??
Sir,
whether we had to print this information on our Invoice that we accept UPI and the UPI ID??
Sir,
Please clarify on :
Turnover means Gross or Net?
Ranganath
Dear Sir
I am working in a service providing company,turnover exceeding 50 cr. we received payment by mode of cheque from many of our clients .
section 269su is applicable on our company????,please clarify.
Regards
Ravi Parkash