Section 269SS and 269T – increase limits and widen coverage to achieve purpose
Section 269SS and 269T concern about acceptance of loan or deposit of money and repayment of the same. In view of proposed amendments, after passing of Finance Bill 2015 specified payments for property deals will also be covered. Provisions provide for receipt as well repayment by way of A/c payee cheques or draft, e- banking transfers etc. in certain circumstances.
Limit must be increased:
The limit of 20000/- was increased w.e.f. 01.04.1989 that is more than 26 years long ago. These limits are kept unchanged in finance bill 2015 also . During the past period from 1989 to 2015 due to inflation, the value of money has gone down very much. To buy same things which What one could buy for 20000 in 1989, one will require more now depending to the item intended to be bought.
As Per Income tax ,1961 Cost inflation index for capital gain purposes for 1988-89 was 161 and for 2014-15 is 1024 so the increase in Cost Inflation index is 863.i.e. more than 6 times.
It is note full effect of inflation if we consider full inflation it will be 8.48 times which is equal to about 1,70,000/-.
We have also to consider that a man who could receive a loan of 20,000/- and purchase some set of things in 1989 now needs 1,70,000/- for same set of things considering CII. So naturally limit for taking loan should be increased. However, keeping in mind increase in banking facilities the limit of 20000/- may be raised to at least 1,00,000/- for any loan and deposit and Rs. Two lakh for immovable property transactions.
Coverage must be widened:
Trade advances may also be covered by provisions of Section 269SS and 269T.
Farmers should also be covered for all loans, advances, property payments, trade advances and payment etc.
A person who is having wealth and substantial agricultural income must be brought into banking channels for all such payments and receipts. Any payment for agricultural produce exceeding 1,00,000/- by one person to any other person must be by A/c payee cheque/ draft or e-banking.
Any person who has gross receipts from agriculture, of Rs.one lakh or more per month (twelve lakh per annum) must also be required to put through his deals through banking channels.
No perceived relaxation under Constitution of India
The Constitution, permit tax on agricultural income by state governments. Under Constitution of India also There is no perceived relaxation either about tax or other procedural requirements. Tax by State Government is to provide States a source of revenue. Central Government is not authorised to tax agricultural income, does not mean that it was intended that any amount of agricultural income should not be taxed. State governments and Central Government Can collaborate to determine, collect and share tax on agricultural income. Now it is high time for the same.