Understanding Section 269ST of the Income Tax Act: Cash Transaction Limits

Learn about Section 269ST of the Income Tax Act, which restricts cash transactions over ₹2 lakh and the penalties for non-compliance.

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Section 269ST of the Income Tax Act prohibits cash transactions exceeding ₹2 lakh to a single person in a day, for a single transaction, or for multiple transactions related to a single event. Non-compliance can result in a 100% penalty of the amount received.

FAQs & Answers

  1. What does Section 269ST of the Income Tax Act prohibit? Section 269ST prohibits cash transactions exceeding ₹2 lakh to a single person in a day, whether for a single transaction or multiple transactions related to a single event.
  2. What are the penalties for non-compliance with Section 269ST? Non-compliance with Section 269ST can result in a penalty of 100% of the amount received in violation of the law.
  3. Who does Section 269ST apply to? Section 269ST applies to all taxpayers in India, including individuals, businesses, and organizations involved in cash transactions.
  4. Are there any exceptions to Section 269ST's cash transaction limit? Yes, certain exceptions may apply for specific categories of transactions, but it is advisable to consult a tax professional for detailed guidance.

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