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Cash deposit more than rs.2 lakhs by customer in account

Pavan Kumar (Student CA IPC / IPCC) (91 Points)

11 October 2018

Dear Experts,

He have sold one machine to Our customer . Against that he has deposited more than Rs.200000 in our bank account . Is there any problem for income tax ? Wheather 269ST will be applicable ? please reply

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8 Replies

Sree Vidya (student) (128 Points)
Replied 11 October 2018

yes. Sec 269ST is applicable if 2.00 Lacs or more deposited at a time for a single transaction

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Pavan Kumar (Student CA IPC / IPCC) (91 Points)
Replied 11 October 2018

Rs.200000 is not a single transaction. Customer deposited different amounts in differnet dates . However the total amount deposited by customer more than Rs.200000.

manmohan baheti (student) (112 Points)
Replied 11 October 2018

the machine sold is a single transition itself

neeraj (sr.accountant) (35 Points)
Replied 11 October 2018

is customer diposit cash in your account more than 2 lakh in sigale shot?

if YES

than there is a problem with that transection.

you should to clear it first.

Sree Vidya (student) (128 Points)
Replied 11 October 2018

of course, but it is a single event right. Pl refer the below

Insertion of new section 269ST.

84 . After section 269SS of the Income-tax Act, the following section shall be inserted, namely:—

'269ST. Mode of undertaking transactions.—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:

Provided that the provisions of this section shall not apply to—

(i) any receipt by—(a) Government;(b) any banking company, post office savings bank or co-operative bank;(ii) transactions of the nature referred to in section 269SS;(iii) such other persons or class of persons or receipts, which the Central Government may, by notification in the Official Gazette, specify.

Explanation.—For the purposes of this section,—

(a) "banking company" shall have the same meaning as assigned to it in clause (i) of the Explanation to section 269SS;(b) "co-operative bank" shall have the same meaning as assigned to it in clause (ii) of the Explanation to section 269SS.'

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neeraj (sr.accountant) (35 Points)
Replied 11 October 2018

Than no problem with this transaction

rama krishnan (12239 Points)
Replied 13 October 2018

269st will applicable

Prathik Lenin (Chartered Accountant) (60 Points)
Replied 20 October 2018

Where payments are made otherwise than by an account payee cheque direclty in the bank accounts of the payee, it meets with the intention of the Legislature. Therefore, eventhough it is not explicity told in the provision it can be regarded as complying with 269ST.

Refer case law with regard to Sir Renukeswara Rice Mills v ITO 2005 Bangalore Bench, this is in relation to 40 A (3) but a similar stand is possible.