cash payment limit

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Amount of cash payment in a single transaction and cash payment for the year to a single person
Replies (6)

As per section 269ST of IT act, cash receipt per transaction/event/day in agreegate is restricted to 2 lakhs of rupees. There is no restriction as a whole per annum. But if you are paying it to procure any goods or services for furtherance of your business, to avoid it to get disallowed, the limit is 10000/- per bill/transaction [section 40A(3) of I T act].

But suppose bill is 199000 ,cash recd below 10000 in different date it is allowed or liable to penalty pls advise
Originally posted by : sandeep
But suppose bill is 199000 ,cash recd below 10000 in different date it is allowed or liable to penalty pls advise


From " Seller " prespective selling something and raising a single invoice of 199000 is ok...he can receive the payments against that invoice either in part or in single cash transaction of the whole pending amount..... NO 269ST (penalty) applicable to seller on amount received in cash upto 199999/- per invoice ... BUT from " buyer " prespective paying anything above 10000/- (10k)in cash against any invoice/expense etc will be disallowed...(the only exception to this is an assesse (buyer) opting presumptive taxation scheme of 44AD to whom this 10k cash expense limit section 40A(3) is not applicable  ).

sir,But some labour contract bill issue 199000 ,& cash recd below 10000 in different date it is allowed u/s 44ad. 44 ab pls advise
Originally posted by : sandeep
sir,But some labour contract bill issue 199000 ,& cash recd below 10000 in different date it is allowed u/s 44ad. 44 ab pls advise


As a recipient an assesse can receive upto 199999/- in cash in part payments against a single invoice  ... section 44ad/44ab is irrelevant here ...

Sir,

I've read the section, and what i understood is , payment to a person above Rs 20,000( as ammended) in a single day is diallowed, I have not seen anything specifying about single bill or transactions.

 


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