IN-DEPTH ANALYSIS OF SECTION 269ST
BASIC PROVISIONS AS PER INCOME TAX ACT
Please note that CBDT has clarified vide press release dates 05.04.2017 that Cash withdrawals from bank do not attract Section 269ST Penalty and article is not been updated with this press release
| 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 |
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APPLICABLE TO |
Any person – Individual, HUF, Firm, LLP, Company, Trust… |
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TYPE OF RECEIPT |
Any Receipt – Whether capital or revenue. |
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MAXIMUM CASH RECEIPTS PERMISSIBLE |
Below Rs. 2,00,000/- |
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PENALTY FOR CONTRAVENTION |
100% of Amount Receipt |
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EXAMPLES OF TRANSACTIONS COVERED |
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In aggregate from a person in a day |
Cash Receipts on a Single Day
Cash Withdrawal from bank on a Single Day
Cash Receipt from Sale of Car [ Assuming Sale Value Rs. 4,00,000/- ]
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in respect of a single transaction |
Payments received in Cash and Other than Cash
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in respect of transactions relating toone event or occasion from a person |
IN CASE OF INDIVIDUAL (Occasion: Marriage or Any other Events)**
** 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. |
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Hello, please assist me.. What will be treatment, if there is various transaction from a single party during the year and aggregate amount crosses rs. 2,00,000/- but no single transaction is above rs 2,00,000/-. What will be the treatment under section 269ST?
Hi Assume my self trader,Can i make a purchase upto 200000 for single peron in day in cash.
Section 40A(3) Will be applicable on person who purchase goods of Rs 20000/- and above in cash.
Please remove cash withdrawal from bank in the illustrations.
Such a penalty could not have been levied on own cash withdrawals from bank and it has been clarified in a Press Release of CBDT dated 05-04-2017.
In another article on this site on 12th Feb, 2017, mentioned that “The word used is “Amount” and not “sum”. In other sections, the word “sum” has been used. The word “Sum” means “sum of money”. The word “Amount” includes cash and kind”. But here only cash component is covered. Please Clarify.
What will be the situation if i have two accounts in different banks and withdraw Rs 150000/- each from both account total amounting to Rs. 300000/-
In example 4 in case of customer Y and W no penalty can be levied. No need to aggregate cash receipts below 2 lacs on different days.
What if i have multiple transactions .I.e each transaction i clear the bill amount by paying cash bellow 2 lakh. But cash payment of multiple transactions is above 2 lakhs in a financial year. Is it liable for penalty?
Good article giving elaborate explanation . Enables even common man to understand.
if i sold a tractor 5.5 lakh and recive 190000.00 and remaining payment rec by cheque.so this is right or not