Saturday, April 23, 2022

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

 

PENALTY  SECTION 271DA ON CASH RECEIPT –SEC. 269ST  OF INCOME TAX ACT

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.

Examples:

S.No.

Situation

 Receiver contravening Sec 269T (Yes/No)

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

A

 

  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).

Yes

500000

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)

2.     

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

Yes

250000

3.     

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

Yes

 

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

4.     

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

Yes

 

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

5.     

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.

No

.

Nil ( because not from same customer )

6.          

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

Yes

 

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

7.          

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

Yes

 

Rs. 500000

8.          

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.

Yes

Car owner Rs. 3 lac.

Dealer Rs. 550000

9.          

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

YES

Rs.4 lac Penalty on  Dealer

10. 

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

Yes

Rs. 250000 Penalty on husband

11. 

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.

Yes

 

Rs. 4 lac *2

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