Which IT section applicable for cash transaction in immovable property

For a ₹2,10,000 cash payment as an advance for a residential property, both 269SS (since it is an advance > ₹20,000 for immovable property) and 269ST (since receipt ≥ ₹2,00,000 in one transaction) get attracted. The seller will face penalty equal to the amount received. Therefore, you should NOT pay ₹2.10 lakh in cash; use bank channels instead.

Multiple sections apply depending on the type of cash transaction in a property deal.

For cash received:
- Section 269ST: No person can accept Rs 2 lakh or more in cash from a single person in a day, for a single transaction, or for transactions relating to a single event or occasion. Receiving cash above Rs 2 lakh for a property sale triggers penalty equal to the amount under Section 271DA.
- Section 269SS: You cannot take a loan, deposit, or advance payment in cash of Rs 20,000 or more. If the property buyer gives you advance payment or security deposit in cash, this falls under 269SS.

For cash paid:
- Section 269T: Repayment of loans or deposits cannot be in cash if the amount exceeds Rs 20,000.
- Section 40A(3): Cash payments above Rs 10,000 per day to a single party are disallowed as business expense.

Additional consequences:
- Property registration authorities may flag cash transactions above the limit to the income tax department.
- The penalty is typically equal to the cash amount received (100%), and the department has been targeting high-value property cash transactions aggressively.

This [cash transaction limits and penalty guide](https://taxgarden.in/blog/cash-transaction-limits-269ss-269t-269st-penalty-india) covers all three sections with specific examples for property, loan, and business transactions.