Saturday, April 23, 2022

Strict Penalties on Cash Receipts on sale of Goods & Services - Under Section 269ST



Sec 269ST provides- No person should receive  Rs. 2 lacs or more in cash ( i.e over Rs. 199000) (a) on a day in aggregate from the same person (b) in respect of a single transaction (c) in respect of transactions related to same event or occasion from a person.

Penalty : Sec, 271DA . if a Person receives any sum in contravention of the Provision of Section 269ST, he shall be Liable to  Penalty = Amount of such  receipt.

Who will pay Penalty ?: Any such receiver getting cash.




 Receiver contravening Sec 269T (Yes/No)

Penalty on receiver(s) under Sec 271DA (Rs)- Reason



  1 a

For SALE OF GOODS OR SERVICES:  Jeweller sells goods worth Rs. 500000 to B as under against :

a)       Bill No. 1 Rs. 150000 on 01.04.22

b)      Bill No. 3 Rs. 200000 on 05.4.22

c)       Bill No. 6 Rs. 50000 on 06.4.22

d)      Bill No. 8 Rs. 100000 on 10.4.22 but

Jeweeller receives 500000 in cash against all 4 bills at different times on a single day ( 11.04.22).



1.    b

If in above situation S receives cash on those 4 days of the billings .

Yes on 05.4.22

Rs. 2 lac 

( exceeds Rs. 199999.99 on 05.04.22)


S sells goods worth Rs. 250000 against bill No. 01 and also receives cash  Rs. 250000




S sells goods worth Rs. 500000 Billed on 4.3.21 ( or for same Vehicle sold )  but received in cash as under:

a)    On Day 1 – 150000 on 10.5.22

b)    On Day 2 – 250000 on 12.5.22

c)    On Day 3 – 100000 on 14.5.22



Rs. 5 lac (because same bill or same car)


S engages B for carrying following Party function:

a)    Decoration and lights– 150000

b)    Food catering – 250000

c)    Tent – 250000

d)    Music – 100000

Pays entire amount in cash at different dates each instalment being lower than 2 lakhs



Rs.750000 (since the transactions relate to one event )


S receives cash as under against :

a)    Bill No. 001 from A – 100000

b)    Bill No. 002 From B – 150000

c)    Bill No. 003 From C – 100000

Entire sum received on the same day.



Nil ( because not from same customer )


S sells goods worth Rs. 300000 to C Ltd and collect cash under against single Purchase order dated 4.4.21 but on different dates  or for same car sold :

a)    On Day 1 on Bill No. 1- 150000

b)    On  Day 2 on Bill No. 2- 150000



RS. 300000 Receipt of single Transaction/ single purchase order/ Same Car


S sells goods worth Rs. 500000 to B-

a)    Against Bill No. 1 – 150000 on day 1

b)    Against Bill No. 2 – 100000 on day 3

c)    Against Bill No. 3 – 250000 on day 6

And collects entire on same day say day 7



Rs. 500000


Car Owner receives Cash Rs. 3 lac from Dealer for sale and Rs. 2 lac by cheque.

Dealer Sells car for Rs. 550000 in Cash.


Car owner Rs. 3 lac.

Dealer Rs. 550000


Of Dealer Rs. 4 lac in cash and 1.5 lac by Bank trf/ account payee cheque in above case


Rs.4 lac Penalty on  Dealer


 CASH GIFT RECEIVED -A accept cash gift Rs. 250000 from his wife


Rs. 250000 Penalty on husband


TOUR ADVANCE: A gives Rs. 4 lac to B going on office tour  from Delhi to Chennai and instructed to deliver the sum to C.



Rs. 4 lac *2

=800000 ( Both B and C liable to pay penalty Rs 4 lac each)


Monday, June 28, 2021

Vendor Verification Method for Higher TDS Deduction

Cases of Deduction of TDS at Higher Rate (Current Discussion)

1. TDS deduction is to be carried out at a higher rate for non-filers of Income Tax Returns as explained by us here, as read under section 206AB of the Income Tax Act.

2. Further, as per Rule 114AAA, the PAN of a person will become inoperative if he fails to link it with Adhaar. Such invalidity of Aadhaar will mean deduction of TDS for such person in a manner that PAN has not been furnished (i.e. @ 20%) as per section 206AA of the Income Tax Act. (The due date for linking has been extended to 30th September 2021)

Checking if Payee falls under the Above Categories

1.Register on the Reporting Portal ( by logging in to using login credentials of TAN and clicking on the link, “Reporting Portal”, which is available under “Pending Actions” Tab of the e-filing Portal.

2. After being redirected to the Reporting Portal, select Compliance Check (Tax Deductor & Collector) under Form Type.

3. Enter details of the principal officer by clicking on “Add Principal Officer” button. 

4. After submission of registration request, email notification will be shared with the Principal Officer along with ITDREIN details and login credentials.

5. After successfully logging in, link to the functionality “Compliance Check for Section 206AB & 206CCA” will appear on the home page of the Reporting Portal. Click on "PAN Search"

5. The following details will be visible about the PAN

- Financial Year: Current Financial Year
- PAN: As provided in the input.
- Name: Masked name of the Person (as per PAN).
- PAN Allotment date: Date of allotment of PAN.
- PAN-Aadhaar Link Status: The response options are "Linked", "Not Linked", "Exempt" or "Not-Applicable" (PAN belongs to non-individual person).
- Specified Person u/s 206AB & 206CCA: The response options are "Yes" (PAN is a specified person as per section 206AB/206CCA as on date) or "No" (PAN is not a specified person as per section 206AB/206CCA as on date).

6. You can also do a "Bulk Search" of up to 10,000 PAN by downloading the CSV Template and uploading the filled in file.


Saturday, June 19, 2021



 ITAT Agra held that  Instruction No. 03/2017, dated 21-2-2017,to the Assessing Officers are statutory and binding on revenue, therefore the Assessing Officer can not tax cash deposit in bank account during Demonetization Scheme, 2016, as unexplained income , the amount less than  2.5 lakhs by and Housewife out her savings since last several years to meet family emergency needs in the case of  Smt Uma Aggarwal v ITO 1(3) Gwalior  [2021] 127 735 (Agra - Trib.)

Saturday, May 29, 2021

GST Amnesty Scheme and Late Fee Waivers (COVID)

At the 43rd GST Council Meeting on 28th May, 2021, the council announced the following relief measures in the form of an Amnesty Scheme that provides relief from late fee for delayed filing of GSTR-3B.

Amnesty Scheme - Late Fee Waiver for Pending GSTR-3B

The late fee for non-furnishing of GSTR-3B from July 2017 to April 2021 has been reduced as under:

(i) Maximum of Rs 500 per return for taxpayers who had NIL GST liability

(ii) Maximum of Rs 1000 per return for those with GST liability

The reduced rates shall apply only if the returns are filed between 01-Jun-2021 to 31-Aug-2021.

Late Fee Linked to Turnover for Prospective Periods

Late fee for delayed filing of GSTR-3B and GSTR-1 will be capped for all future returns as follows.

1. NIL tax liability in GSTR-3B or NIL outward supplies in GSTR-1: Maximum Rs 500

2. Other than NIL tax liability, the late fee would be capped based on Aggregate Annual Turnover of the preceding financial year, as follows.

(a) Up to Rs 1.5 crores: Maximum of Rs 2,000
(b) Between Rs 1.5 crore to Rs 5 crore: Maximum of Rs 5,000
(c) Above Rs 5 crores: Maximum of Rs 10,000

3. GSTR-4 by Composition Taxpayers: Maximum Rs 500 per return, if tax liability is NIL in the return, and Rs 2000 if liability is other than NIL.

4. Delayed furnishing of GSTR-7 to be reduced to Rs.50/- per day; capped to a maximum of Rs 2000 per return.

Interest & Late Fee Relief for March, April & May 2021 Returns for GSTR-3B

In addition to the relief measures already provided, the following further relaxations are being provided:

1. If Aggregate Turnover up to Rs. 5 crores:

a) Interest for March & April 2021:
- First 15 days after due date: NIL interest
- Next 45 days for March and 30 days for April: 9% p.a.
- 18% p.a. interest thereafter

b) Late Fee for March & April 2021:
- NIL for 60 days after due date of March
- NIL for 45 days after due date of April

c) For May 2021:
- NIL interest for first 15 days from the due date
- 9% p.a. interest for next 15 days
- No Late Fee for up to 30 days delay in furnishing GSTR-3B for monthly taxpayers

2. Aggregate Turnover > Rs. 5 crores:

a) Interest @ 9% p.a. for first 15 days after due date for GSTR-3B for May

b) Late Fee Waiver for up to 15 days delay in filing GSTR-3B for May

3. Other Extensions

a) GSTR-1/ IFF due date for May 2021 extended by 15 days

b) GSTR-4 due date for FY 2020-21 extended to 31-Jul-2021

c) ITC-04 due date for Jan-Mar 2021 extended to 30-Jun-2021

d) Cumulative application of rule 36(4) for availing ITC for tax periods April, May and June, 2021 in the return for the period June, 2021.

e) Allowing filing of returns by companies using EVC till 31-Aug-2021.

Annual Return FY 2020-21

(i) Self-certification of reconciliation statement in GSTR-9C - CA certification not required

(ii) GSTR-9/9A optional if aggregate annual turnover is up to Rs 2 crores

(iii) GSTR-9C mandatory if annual aggregate turnover above Rs 5 crores

Friday, May 21, 2021

How to Buy Medical Insurance in India: Quick Tips

1. Minimum coverage of 6x your monthly in-hand salary, but nothing less than Rs. 5 Lakhs

2. The insurer should have most big brand hospitals of your city in its cashless network

3. Pick the insurer with a higher claim settlement ratio (above 90%)

4. Check if you want a policy for self (individual) or floater (including family members). If there is someone in the family with health issues, take an individual policy for them and do not club them in floater.

5. Waiting Period on the policy is the initial 2-3-4 years when certain illnesses will not be covered. Check this and the list of illnesses to see if you have any chances of getting any of these soon.

6. Based on your needs in the next few years, you may want to consider coverage of:
- existing illnesses
- maternity and childcare needs
- day care procedures
- critical illnesses

7. Critical illness coverage - specified 20-30 diseases where the sum assured is paid on diagnosis and submission of bills for claim is not required - take a cancer coverage if you have family history of the disease - serious illness coverage can be taken separately with a life insurance instead of health insurance for a cheaper premium

8. Room Rate: Check if they will give you an individual room and not a bed in the general ward; also room rate may normally be defined as a % of the total cover, or be defined as a cap. Eg 1% of a 5L policy or a cap of 3k per day. If hospitals around you charge more per day, please insist on a higher room rent. Other medical expenses may be linked to room rent. Thus, you may have to co-pay all expenses in proportion to room rent coverage by the insurer.

9. Co-Payment: You ideally want no or lower co-payment

10. Pre and Post Hospitalization expenses should be covered for 60 to 180 days

11. No claim bonus will enhance coverage at a low cost for future years

12. Zonal coverage covers only in a particular city, and Pan India covers treatment anywhere in the country

13. Reasonable and customary clause reimburses as per rates in other hospitals around you, which may be cheaper - so avoid

14. Between a Top up and Super Top Up, buy the latter - you can buy from another insurer on the base policy

15. If you are in employment, and leaving the service, convert your existing group insurance plan to an individual plan so that you don't have a waiting period in the new policy that you take
16. Purchasing a health insurance also gives you tax saving deduction under section 80D of the Income Tax Act