CBDT enables Digital Payment Facility for Income Tax Payers [Read Notification]

The Central Board of Direct Tax (CBDT) has enabled the Digital Payment Facility for Income Tax Payers.

has issued a notification on January 29, 2020, and amended the Income Tax Rules, 1962 by introducing Income Tax (3rd Amendment) Rules, 2020 which will be enforced on the date of its publication in the Official Gazette of India.

Under the Income Tax (3rd Amendment) Rules, 2020 Rule 6ABBA was inserted in order to specify which modes will be considered to be the Digital Payment under ‘other electronic modes’. ‘Other Electronic Modes’ consists of the code credit cards, debit cards, net banking, IMPS (Immediate Payment Service), UPI (Unified Payment Interface), RTGS (Real Time Gross Settlement), NEFT (National Electronic Fund Transfer) and BHIM (Bharat Interface for Money) Aadhar Pay.

Further, in the case of Rule 6DD the marginal heading which was inserted was that:

Firstly, “cases and circumstances in which the payment exceeding ten thousand rupees may be made to a person in a day, otherwise than by an account payee cheque drawn on a bank or account payee bank draft or use of electronic clearing system through a bank account or through such other electronic mode as prescribed under Rule 6ABBA.“

Secondly, in the opening paragraph the words ‘account payee bank draft, exceeds twenty thousand rupees’ is substituted by the phrase ‘account payee bank draft or use of electronic clearing system through a bank account or through such electronic mode as prescribed under Rule 6ABBA exceeds 10,000 rupees.’

Further, in Rule 6DD in (C) clause (C), sub-clauses (v), (vi) and (vii) were omitted and also clause (d) of (j) was also omitted. Wherefore, in the explanatory memorandum clause, it is clarified that these provisions do not adversely affect any person.