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.
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:
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.
Summary – 269SU
√ Applies to every person
√ carrying on business and
√ turnover of the business exceeds ₹ 50 crore during the immediately preceding previous year
√ This section came in to effect from 01-01-2020 and to equip yourself time has given up to 31-01-2020.
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)
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.