S.269SS and S.269T mandate that transactions in the nature of acceptance/repayment of loan/ deposit etc should be done through account payee cheque or account payee bank draft or use of electronic clearing system through a bank account. Non-adherence of provisions of S.269SS or S.269T invites penalty u/s 271D & E, respectively. However, S.273B provides a safe harbor if such default is because of a reasonable cause.

In its recent judgment Mumbai ITAT has observed, 𝘄𝗵𝗲𝗿𝗲𝗶𝗻 𝗹𝗼𝗮𝗻 𝘁𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻𝘀 𝗮𝗿𝗲 𝘀𝗾𝘂𝗮𝗿𝗲𝗱 𝗼𝗳𝗳 𝗯𝘆 𝗷𝗼𝘂𝗿𝗻𝗮𝗹 𝗲𝗻𝘁𝗿𝗶𝗲𝘀 𝗶𝗻 𝗮 𝗯𝗮𝗰𝗸𝗱𝗿𝗼𝗽 𝗼𝗳 𝗴𝗲𝗻𝘂𝗶𝗻𝗲 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝘁𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻𝘀, 𝗶𝘁 𝘄𝗼𝘂𝗹𝗱 𝗯𝗲 𝘀𝗮𝗳𝗲 𝘁𝗼 𝗰𝗼𝗻𝗰𝗹𝘂𝗱𝗲 𝘁𝗵𝗮𝘁 𝘁𝗵𝗲𝘀𝗲 𝗲𝗻𝘁𝗿𝗶𝗲𝘀 𝘄𝗲𝗿𝗲 𝗽𝗮𝘀𝘀𝗲𝗱 𝗼𝘂𝘁 𝗼𝗳 𝗯𝘂𝘀𝗶𝗻𝗲𝘀𝘀 𝗰𝗼𝗻𝘀𝘁𝗿𝗮𝗶𝗻𝘁𝘀, 𝗲𝘅𝗶𝗴𝗲𝗻𝗰𝗶𝗲𝘀 𝗮𝗻𝗱 𝗮𝗱𝗺𝗶𝗻𝗶𝘀𝘁𝗿𝗮𝘁𝗶𝘃𝗲 𝗰𝗼𝗻𝘃𝗲𝗻𝗶𝗲𝗻𝗰𝗲. Such business constraints, exigencies, and administrative convenience 𝘄𝗼𝘂𝗹𝗱 𝗰𝗼𝗻𝘀𝘁𝗶𝘁𝘂𝘁𝗲 𝗿𝗲𝗮𝘀𝗼𝗻𝗮𝗯𝗹𝗲 𝗰𝗮𝘂𝘀𝗲 𝘄𝗶𝘁𝗵𝗶𝗻 𝘁𝗵𝗲 𝗺𝗲𝗮𝗻𝗶𝗻𝗴 𝗼𝗳 𝗦.𝟮𝟳𝟯𝗕 𝗼𝗳 𝘁𝗵𝗲 𝗔𝗰𝘁 𝗮𝗻𝗱 𝗽𝗲𝗻𝗮𝗹𝘁𝘆 𝘄𝗼𝘂𝗹𝗱 𝗻𝗼𝘁 𝗯𝗲 𝗮𝗽𝗽𝗹𝗶𝗰𝗮𝗯𝗹𝗲 𝗶𝗻 𝘀𝗾𝘂𝗮𝗿𝗶𝗻𝗴 𝗼𝗳 𝘁𝗿𝗮𝗻𝘀𝗮𝗰𝘁𝗶𝗼𝗻𝘀.

[ 𝗠/𝘀. 𝗠𝗮𝗰𝗿𝗼𝘁𝗲𝗰𝗵 𝗗𝗲𝘃𝗲𝗹𝗼𝗽𝗲𝗿𝘀 𝗟𝘁𝗱., 𝗜𝗧𝗔 𝗡𝗼.𝟯𝟬𝟰𝟵 & 𝟰𝟬𝟱𝟰 /𝗠𝘂𝗺/𝟮𝟬𝟭𝟵]

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