News Buzz

B2B cos. exempted from using only electronic payments

On Wednesday, the Ministry of Finance exempted firms with a turnover of over 50 crore and involved in only B2B transactions from the requirement of accepting payments only by electronic modes like RuPay or BHIM-UPI. This has been done with the intention to encourage digital transactions and move towards a less-cash economy.

“It is clarified that the provisions of Section 269SU of the Act shall not be applicable to a specified person having only B2B transactions (i.e. no transaction with retail customer/consumer) if at least 95% of aggregate of all amounts received during the previous year, including amount received for sales, turnover or gross receipts, are by any mode other than cash,” the CBDT circular notified.

Instead, the government inserted a new provision, Section 269SU, in the Finance Act, 2019. This requires a person carrying on business and having sales/turnover/gross receipts from business of more than 50 crore in the immediately preceding previous year to compulsorily provide facilities for accepting payments through prescribed electronic modes.

Commenting on this, Nangia Andersen Consulting Director Shailesh Kumar said, “This is another instance that shows the government is responsive to needs and concerns of taxpayers as well as flexible to amend rules to remove genuine hardships of taxpayers.”