Case Studies on Section 269ST of Income Tax

As per 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 an electronic clearing system through a bank account or through such other electronic mode as may be prescribed.

The following entities are exempt u/s 269ST of Income Tax:

(a) Government;

(b) any banking company, post office savings bank or cooperative bank;

Further as per NOTIFICATION NO. SO 2065(E) [NO.57/2017 (F.NO.370142/10/2017-TPL)], DATED 3-7-2017 the provision of section 269ST shall not apply to the following, namely:

(a) receipt by a business correspondent on behalf of a banking company or co-operative bank, in accordance with the guidelines issued by the Reserve Bank of India;

(b) receipt by a white label automated teller machine operator from retail outlet sources on behalf of a banking company or co-operative bank, in accordance with the authorisation issued by the Reserve Bank of India under the Payment and Settlement Systems Act, 2007 (51 of 2007);

(c) receipt from an agent by an issuer of pre-paid payment instruments, in accordance with the authorisation issued by the Reserve Bank of India under the Payment and Settlement Systems Act, 2007 (51 of 2007);

(d) receipt by a company or institution issuing credit cards against bills raised in respect of one or more credit cards;

(e) receipt which is not includible in the total income under clause (17A) of section 10 of the Income-tax Act, 1961.

Case Studies on Section 269ST of Income Tax