Cash receipt by Co-op. Society from dealer not to be aggregated for Sec. 269ST purposes: CBDT

Circular No. 25/2022, dated, 30-12-2022

Section 269ST provides that no person is allowed to receive a sum of Rs. 2,00,000 or more, from a person in a day or in respect of a single transaction or in relation to one event or occasion, in cash or an impermissible mode. Any contravention of this provision attracts a penalty under Section 271DA.

Reference was received by the Central Board of Direct Taxes (CBDT) as to whether receipt of cash by Co-operative Societies from a distributor for the sale of milk on a bank holiday or a day when the bank is closed should be considered a single transaction or aggregated with all such cash receipts from the distributor in the previous year to be treated as a single event or occasion under Section 269ST.

It was clarified by the board in respect of Co-operative Societies, a dealership/ distributorship contract by itself may not constitute an event or occasion for the purposes of Section 269ST. Thus, all such receipts by societies from dealers should not be aggregated across multiple days for the purposes of Section 269ST.

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