Cash received Section 269ST

Tax queries 178 views 1 replies
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50 Points Joined October 2017

X received received cash gift from relatives totalling ₹9,00,000 in a day  for X's mother's medical treatment . 

Six relatives have given cash gift @ ₹1,50,000/- each. 

Is it violation of Sec 269ST ?

Please advise.

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On 13 March 2025 at 09:53 Report
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Master in Accounts & high court Advocate
8991 Points Joined December 2011

Receiving cash gifts totaling ₹9,00,000 in a day from six relatives, with each giving ₹1,50,000, does indeed violate Section 269ST of the Income Tax Act. This section prohibits receiving cash of ₹2 lakh or more in a single day from a single source, whether as a single transaction, aggregate transactions, or transactions related to one event or occasion.¹ ² In this scenario, each relative's contribution of ₹1,50,000 exceeds the ₹2 lakh limit when aggregated with the others, and since the purpose is for X's mother's medical treatment, it's considered a single occasion. Violating Section 269ST can lead to penalties equal to the amount received in cash, which in this case would be ₹9,00,000. However, it's worth noting that gifts received from relatives may be exempt from tax under certain conditions, but this exemption doesn't apply to the provisions of Section 269ST. To avoid such penalties, it's advisable to explore alternative modes of receiving these gifts, such as through bank transfers or cheques.

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On 13 March 2025 at 11:31


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