100% Penalty if amount exceeding Rs 2 Lakh paid in cash

By | July 15, 2019
(Last Updated On: July 15, 2019)
Ministry of Finance

Payments through Debit Cards

Posted On: 15 JUL 2019 6:15PM by PIB Delhi

As per Reserve Bank of India (RBI), the limit for purchase of goods and services through a card are decided by the card-issuer bank. As apprised by Public Sector Banks (PSBs), the maximum limit of making payment through debit card for making a purchase has not been reduced by banks.

As apprised by Central Board of Direct Taxes (CBDT), Department of Revenue, the Government has taken various steps to move towards a less cash economy and reduce generation and circulation of black money. Finance Act, 2017, section 269ST, inserted in the Income-tax Act, 1961, provides that no person is permitted to receive an amount of Rs 2 lakh or more:-

  1. in aggregate from a person in a day;
  2. in respect of a single transaction; or
  3. in respect of transactions relating to one event or occasion from a person;

otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account. Further, penalty provision at the rate of 100 per cent of such amount is applicable, if amount is received in violation of the above provisions of section 269ST of the Act.

This was stated by Shri Anurag Thakur, Minister of State for Finance & Corporate Affairs in a written reply to a question in Lok Sabha today.

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