No more Agreements(Byana) of immovable property in cash

With the amendment in section 269SS to be applicable with effect from June 1, 2015 with the passage of Finance Bill 2015 it will become impossible to enter into an agreement for purchase and sale of immovable property if amount of advance against this agreement is  more than Rs. 20000/-, even if this agreement matures.  This will create an undue hardship to the genuine parties  and will effect adversely  the real   estate sector despite of the fact that some in genuine may be curtailed. Newly amended section 269SS and 269T is reproduced here below which clearly prohibits  such transactions and will attract penalt under sectin 271D and 271E

For section 269SS of the Income-tax Act, the following section shall be substituted with effect from the 1st day of June, 2015, namely:—

‘269SS. No person shall take or accept from any other person (herein referred to as the depositor), any loan or deposit or any specified sum, otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account, if,—

 (a) the amount of such loan or deposit or specified sum or the aggregate amount of such loan, deposit and specified sum; or

 (b) on the date of taking or accepting such loan or deposit or specified sum, any loan or deposit or specified sum 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 to in clause (b),

 is twenty thousand rupees or more:

Provided that the provisions of this section shall not apply to any loan or deposit or specified sum taken or accepted from, or any loan or deposit or specified sum taken or accepted by,—

 (a) the Government;

 (b) any banking company, post office savings bank or co-operative bank;

 (c) any corporation established by a Central, State or Provincial Act;

(d) any Government company as defined in clause (45) of section 2 of the Companies Act, 2013;

(e) such other institution, association or body or class of institutions, associations or bodies which the Central Government may, for reasons to be recorded in writing, notify in this behalf in the Official Gazette:

Provided further that the provisions of this section shall not apply to any loan or deposit or specified sum, where the person from whom the loan or deposit or specified sum is taken or accepted and the person by whom the loan or deposit or specified sum is taken or accepted, are both having agricultural income and neither of them has any income chargeable to tax under this Act. Explanation.– For the purposes of this section,—

 (i) “banking company” means a company to which the provisions of the Banking Regulation Act, 1949 applies and includes any bank or banking institution referred to in section 51 of that Act;

 (ii) “co-operative bank” shall have the same meaning as assigned to it in Part V of the Banking Regulation Act, 1949;

(iii) “loan or deposit” means loan or deposit of money;

(iv) “specified sum” means any sum of money receivable, whether as advance or otherwise, in relation to transfer of an immovable property, whether or not the transfer takes place.’.

 In section 269T of the Income-tax Act, with effect from the 1st day of June, 2015,—

(A) in the opening portion—

 (a) after the words “repay any loan or deposit made with it”, the words “or any specified advance received by it” shall be inserted;

(b) after the words “made the loan or deposit”, the words “or paid the specified advance,” shall be inserted;

(B) in clause (a), after the words “loan or deposit”, the words “or specified advance” shall be inserted;

(C) in clause (b), the word “or” shall be inserted at the end;

(D) after clause (b) and before the long line, the following clause shall be inserted, namely:— “(c) the aggregate amount of the specified advances received by such person 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 specified advances,”;

(E) in the second proviso, after the words “any loan or deposit”, the words “or specified advance” shall be inserted;

 (F) in the Explanation, after clause (iii), the following clause shall be inserted, namely:—

 ‘(iv) “specified advance” means any sum of money in the nature of advance, by whatever name called, in relation to transfer of an immovable property, whether or not the transfer takes place.’.