||Mode of taking or accepting
certain loans and deposits
||Mode of repayment of certain
loans or deposits
1. Mode of taking or accepting certain loans and deposits (Section 269SS)-
No person shall take or accept from any other person any loan or deposit otherwise than by an account payee cheque or account payee band draft if, –
(a) the amount of such loan or deposit or the aggregate amount of such loans and deposits or;
(b) on the date of taking or accepting such loan or deposit, any loan or deposit, taken or accepted earlier by such person from the depositor is remaining unpaid, (whether repayment has fallen due or not), the amount or the aggregate amount remaining unpaid; or
(c) the amount or the aggregate amount referred to in clause (a) together with the amount or the aggregate amount referred in (b) above is Rs. 20,000 [Rs. 10,000 up-to Assessment Year 1988-1989] or more;
The above Rule shall however not apply to any loan or deposit taken or accepted from, or any loan or deposit taken or accepted by, – Government; any Banking Company, Post Office Saving Bank or Co-Operative Banks; any Corporation established by Central Government, State or Provincial Act; any Government Company such other institution, association or body or class of institutions, associations or bodies which the Central Government may notify in this behalf in the Official Gazette.
However, the provisions of this section regarding taking or acceptance of loans in cash do not apply where the person taking the loan as well as the person giving the loan both are having only agricultural income and neither of them has any income chargeable to tax. Thus an agriculturist can take any amount of loan in cash from another agriculturist provided neither of them have any income from any other source chargeable to tax.
2. Mode of repayment of certain loans or deposits [Section 269T]
No Branch of a banking company or a co-operative band and no other company or co-operative society and no firm or other person shall repay any loan or deposit made with it otherwise than by an account payee cheque or account payee bank draft drawn in the name of the person who has made the deposit if,-
(a) the amount of the loan or deposit together with interest, if any, payable thereon, or
(b) the aggregate amount of the loan or deposit held by such person with the branch of the banking company or co-operative bank or, as the case maybe, the other company or co-operative society or the firm, either in his own name or jointly with any other person on the date of such repayment together with the interest, if any, payable on such deposits is Rs. 20,000 or more;
However, where the repayment is by a branch of a banking company or co-operative bank, such repayment may also be made by crediting the amount of such deposit to the savings bank account or the current account (if any) with such branch of the person to whom such loan or deposit has to be repaid.
This provision shall however not apply to repayment of any loan or deposit taken or accepted from Government Corporation, Government Companies, Banking Companies, Co-operative Banks etc. and institution notified by the Central Government.