1. Section 269SS: Prohibition on Taking and Accepting Loan/Deposits etc.
No person shall take or accept from any other person, any loan or deposit or any specified sum, otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account [or through such other electronic mode as may be prescribed].
And also if on the date of taking or accepting such loan or deposit or specified sum, any loan or deposit or specified sum taken or accepted earlier by such person from the depositor is remaining unpaid (whether repayment has fallen due or not), the amount or the aggregate amount remaining unpaid which was taken any mode other than prescribed mode totaling to RS 20000.
Examples
1. If A wants loan/deposit/any specified sum from B on cash then such amount shall not exceed Rs 20000
2. If A has already taken a loan of Rs 9000 from B in cash and has not yet repaid it and wants to take more loan on cash then maximum amount of loan he can take is Rs 11000.
Exceptions to 269SS
- Any loan or deposit or specified sum “taken or accepted from” or “taken or accepted by” the following entities –
1. The Government
2. Any banking company, post office savings bank or co-operative bank
3. Any corporation established by a Central, State or Provincial Act
4. Any Government company as defined in clause (45) of section 2 of the Companies Act, 2013 (18 of 2013)
5. Any institution, association or body or class of institutions, associations or bodies notified in Official Gazette
Thus, if any person accepts any loan or deposit or specified sum from the above-mentioned entities, or the entities accept any loan or deposit or specified sum from any person, provisions of 269SS will not apply.
- If (both) provider and accept or of loan or deposit or any specified sum is a person having income only from Agricultural Income.
Penalty on contravention
100% of the loan or deposit amount will be the quantum of penalty that can be levied by the assessing officer.
Author Bio
Good