Big relief to Corona patients, more than 2 lakh cash payment can be made in the hospital

- This exemption granted by CBDT will be applicable till 31st May

New delhi date. Saturday, May 8, 2021

All medical centers including private hospitals, covid centers, dispensaries, nursing homes will now be able to accept cash payments of more than Rs 2 lakh. This exemption has been granted by the Central Board of Direct Taxes (CBDT). This exemption will be valid till May 31. However, the limit of cash payment has not been fixed.

In fact, Section 269 ST of the Income Tax Act prohibits cash transactions of more than Rs 2 lakh per person in the country. The government enacted the rule in 2017 to curb the use of black money. According to this rule, if a person wants to transact more than Rs 2 lakh, it can be done only by check, draft, net banking or digital method.

An application was filed in the Delhi High Court seeking suspension of the clause. The petition was filed by a man named Manisha Gupta. He said that hospitals were not accepting cash payments of more than Rs 2 lakh so the treatment of patients was being delayed. During the hearing, the government said it was considering granting exemptions under the rule.

The CBDT then issued an order stating that cash payments of more than Rs 2 lakh could now be made at all medical centers, including private hospitals, covid care centers and nursing homes, where Corona patients are being treated. The order was implemented on April 1 and will remain in force till May 31. However, no limit of cash payment has been fixed yet.