Regarding cash purchase limit for purchase from interstate farmers.

466 views 4 replies

I want to know how much cash payment can be made to interstate farmers for purchase of agriproduce?

Replies (4)
Less then 2 Lacs

Is 2 lakhs per day limit, or i can pay to multiple farmers following 2 lakhs per day limit payment to single farmer.

Its per farmer per day per event... Less then 2 lakhs can be given in cash.

Section 269ST prohibits any person to receive an amount of Rs.2 lakh and above in cash:

  • In aggregate from a person in a day, or 
  • In a single transaction, or 
  • In respect of transactions relating to one event or occasion from a person. 

This section will not apply to-

  • Government
  • any banking company
  • post office savings bank
  • co-operative bank
  • other persons/receipts as may be notified
  • Transactions referred to in section 269SS (attracted when we accept loan from any person) will be excluded from the scope of the new section 269ST.

However there is a exception to section 271DA; According to section 271DA if person proves that there were good and sufficient reasons for contravention of section 269ST then no person shall be liable.

However, in case you are making payment of/above 2,00,000 to any farmer, Provisions of new Section 269ST will be applicable and Penalty can be levied on farmer for accepting payment above 2,00,000 in cash since no exemption is given to farmers under Section 269ST. (refer:            Circular No. 27/2017 Dated 3rd November 2017)

269st applicable to recipient and not payer. as per section 40A(3) ,you are not supposed to make payments in excess of 10000 in cash. however, since the payments are made to farmers, there's no limit for you but the farmers are not supposed to receive cash in excess of 2 lakhs


CCI Pro

Leave a Reply

Your are not logged in . Please login to post replies

Click here to Login / Register  

Company
27 May 2026
Audit Assitant

Virender K Gupta and Co

New Delhi

B.Com

View Details
Company
ARTICLESHIP 09 June 2026
Article Trainee

Numbertree LLP

Mumbai

CA Inter

View Details
Company
29 May 2026
Company Secretary - Part time

Shaswat initial support private limited

Ahmedabad

CS

View Details
Company
26 May 2026
Audit executive

vdsr & co LLP

Chennai

CA Inter

View Details
Company
22 May 2026
Sr. Financial Analyst - Consolidation

Search Synergy

Mumbai

CA

View Details
Company
ARTICLESHIP 27 May 2026
CA Article Trainee

Rahul Dang & Associates-Chartered Accountants

Pune

CA Inter

View Details
Company
Featured 27 May 2026
Lead Conversion Executive / Sales Closing Executive

SMJ global advisors pvt ltd

New Delhi

B.Com

View Details
Company
22 May 2026
Audit assistant

Displayandbeyond

Mumbai

CA

View Details