Income Tax Department warns of penalties for cash transactions in India

The Income Tax Department has issued a warning against cash transactions, highlighting strict penalties for violations. Under the Income Tax Act, cash payments above certain limits can lead to penalties equal to the amount involved. Key regulations include prohibitions on cash loans over ₹20,000 and cash receipts of ₹2 lakh or more in a day. Violators face significant penalties, emphasizing the importance of compliance. Businesses with turnovers over ₹50 crore must offer digital payment options. Non-compliance can result in daily fines of ₹5,000. These measures aim to encourage digital transactions and reduce cash reliance.