Circular on clarification for the purposes of Clause(c) of Section 269ST of the Income-tax Act,1961 in respect of dealership/distributorship contract in case of Co-operative Societies regarding(dated-30.12.2022)-CBDT.

  • 02nd, January 2023
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Circular on clarification for the purposes of Clause(c) of Section 269ST of the Income-tax Act,1961 in respect of dealership/distributorship contract in case of Co-operative Societies regarding(dated-30.12.2022)-CBDT.

  • References have been received in respect of Milk Producers’ Cooperative as to whether under the provisions of Section 269ST of the Act, receipt(s) in cash in a day of bank holiday/closure of bank day within ‘the prescribed limit’ from a distributor against sale of milk when payments were through bank on all other days is to be considered as a single transaction or whether all such receipts in cash in a previous year would be aggregated in respect of transactions with a distributor to treat it as one event or occasion.
  • With respect to the reference at Para 2 above, it is clarified that in respect of Co –operative Societies, a dealership/ distributorship contract by itself may not constitute an event or occasion for the purposes of clause (c) of Section 269ST. Receipt related to such a dealership/distributorship contract by the Co-operative Society on any day in a previous year, which is within ‘the prescribed limit’ and complies with clause (a) as well as clause (b) of Section 269ST, may not be aggregated across multiple days for purposes of clause (c) of Section 269ST for that previous year, refer attachment for further details.
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