Section 269SU (Acceptance of payment through prescribed electronic modes) of the Income Tax Act, 1961 was inserted vide the Finance Act (No. 2) of 2019.
The Section states that:
Every person, carrying on business, shall provide facility for accepting payment through prescribed electronic modes, in addition to the facility for other electronic modes, of payment, if any, being provided by such person, if his total sales, turnover or gross receipts, as the case may be, in business exceeds fifty crore rupees during the immediately preceding previous year.
The prescribed modes are as follows:
i. Debit Card Powered by Rupay.
ii. Unified Payment Interface (UPI) (BHIM-UPI)
iii. Unified Payment Interface Quick Response Code (UPI QR Code) (BHIM-UPI QR Code).
Now, as per Circular No. 12 of 2020 of the Income Tax Act, 1961, it is clarified that provisions of section 269SU of the Act shall not be applicable to a specified person having only B2B transaction s (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.
To read the Circular: CLICK HERE