Section 269ST, Income Tax

[Ethirajan Parthasarathy]

Penalty u/s 269ST is attracted for cash transaction above Rs.2,00,000/- My query is whether section 269ST is attracted if a partner draws cash of Rs.50,000/- per month towards his current account.

Posts / Replies

[Padmanathan Kollengode]

Section 269ST reads as follows:

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 2[bank account or through such other electronic mode as may be prescribed]:

Therefore if partner withdraws Rs.50,000/- per month, it is neither a single transaction nor related to one event or occasion exceeding Rs.2,00,000/-.

Thus, in my opinion 269ST will not be attracted.