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May 8, 2021

Hospitals can receive cash of more than 2 Lakhs beyond limit of Scetion 269ST of Income Tax Act

by CA Shivam Jaiswal in Income Tax

Hospitals can receive cash of more than 2 Lakhs beyond limit of Scetion 269ST of Income Tax Act

The Central Bo­ard of Direct Taxes (CBDT) has recognised the issues faced by individuals who were unable to pay Covid­related hospital bills excee­ding Rs 2 lakh in cash, owing to income-tax regula­tions that prohibited hospi­tals and nursing homes from accepting such large cash payments. The string­ent provisions have been re­laxed up to May 31.

Families of patients who are not net savvy were hard hit as they could not pay the bills via net-ban­king facilities. Hospitals ty­pically do not accept chequ­es and there are limits on debit and credit cards.

The CBDT notification covers hospitals, dispensa­ries, nursing homes, Covid care centres or similar other medical facilities.

Three conditions for hospitals for claiming benefit of this exemption of receiving cash exceeding RS 2 lacs

  1. PAN or Adhar of Patient must.
  2. In case payment is not being made by patient but by a relative then PAN and Aadhar of such relative.
  3. Relationship of such payee with the patient.

Read Notification below

MINISTRY OF FINANCE
(Department of Revenue)
(CENTRAL BOARD OF DIRECT TAXES)
NOTIFICATION
New Delhi, the 7th May, 2021
(INCOME-TAX)

S.O. 1803(E).—The Central Government, in exercise of powers conferred by clause (iii) of Proviso to Section 269ST of the Income-tax Act, 1961, hereby specifies Hospitals, Dispensaries, Nursing Homes, Covid Care Centres or similar other medical facilities providing Covid treatment to patients for the purpose of Section 269ST of the Income-tax Act,1961 for payment received in cash during 01.04.2021 to 31.05.2021, on obtaining the PAN or AADHAAR of the patient and the payee and the relationship between the patient and the payee by such Hospitals, Dispensaries, Nursing Homes, Covid Care Centres or similar other medical facilities.

[Notification No. 56/2021/F. No. 225/58/2021-ITA.II]
PRAJNA PARAMITA, Director

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