Cash payment to farmers?

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15 Points Posted on 17 March 2021
Does cash payment made to farmers in excess of Rs 20000/ comes under purview of section 269ss and same can be disallowed by Income tax Authority?
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On 17 March 2021 at 22:22 Report
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This discussion clarifies whether cash payments exceeding £20,000 made to farmers fall under Section 269SS of the Income Tax Act and could be disallowed. While Section 269SS generally prohibits cash payments of £20,000 or more, there are specific exemptions, particularly under Rule 6DD. Payments made for agricultural produce, livestock, dairy, fish, or horticultural products directly to the cultivator, grower, or producer are allowed in cash without limit, provided certain conditions regarding agricultural income are met.

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Chartered Accountant
24588 Points Posted on 17 March 2021
You cannot make payment 20000 rupees in cash at a single transaction in a day u/s 269SS.
A person cannot accept loan or deposit or any other specified sum (specified sum here refers to an advance or otherwise, in relation to the transfer of any immovable property) from another person otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account, if –
Amount of loan or deposit or specified sum is Rs. 20,000 or more.
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On 17 March 2021 at 22:42
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Partner
1072 Points Posted on 18 March 2021

Please see related rules.

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On 18 March 2021 at 18:02
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job in industry
329 Points Posted on 19 March 2021
As per the section 269ss exemption of this section - the indivisual having the agriculture income only and received the loan or deposit in the excess of 20000 or more from indivisule who also having agriculture income only then section 269ss not taken force into it. so, here the payment to farmers in the excess of 20000 is not disallowed by the income tax authorities.
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On 19 March 2021 at 12:51
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Partner
1072 Points Posted on 19 March 2021

269SS is for loan/deposits.

what is your exact query.

following cash payment is allowed without limit under rule 6DD.

where the payment is made for the purchase of—
(i)   agricultural or forest produce; or
(ii)   the produce of animal husbandry (including livestock, meat, hides and skins) or dairy or poultry farming; or
(iii)   fish or fish products; or
(iv)   the products of horticulture or apiculture,
    to the cultivator, grower or producer of such articles, produce or products;

 

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On 19 March 2021 at 13:09

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