Clause 31 of Form explained: this guide covers what it means, who it applies to, the step-by-step process, documents required, fees, due dates and penalties in India — so you can stay compliant with confidence and avoid costly mistakes.
Sub-clauses 31(ba) to 31(bd) of Form 3CD report receipts and payments above the section 269ST limit of Rs 2 lakh — separately for amounts received or paid outside banking channels and for amounts by cheque or draft that is not account payee.
Section 269ST, the provision behind the clause
Section 269ST provides that no person shall receive Rs 2 lakh or more:
- (a) in aggregate from a person in a day; or
- (b) in respect of a single transaction; or
- (c) in respect of transactions relating to one event or occasion from a person,
otherwise than by an account payee cheque, an account payee demand draft, or use of an electronic clearing system through a bank account, or such other electronic mode as may be prescribed. Contravention attracts penalty under section 271DA.
The limits at (a), (b) and (c) apply separately. A receipt can be within the daily aggregate and still breach section 269ST because it relates to a single transaction of Rs 2 lakh or more, or because it forms part of receipts relating to one event or occasion. A wedding, a project, a contract — each can be an "event or occasion" that aggregates receipts spread across many days.
Paragraph 56.2 records the exclusions: section 269ST does not apply to receipt by the Government, any banking company, post office savings bank or co-operative bank, or to transactions of loan or deposit or specified sum referred to in section 269SS.
The four sub-clauses
| Sub-clause | Covers | Particulars required |
|---|---|---|
| 31(ba) | Receipts above the section 269ST limit, otherwise than by cheque, bank draft or electronic clearing system | Name, address and PAN or Aadhaar of the payer (if available); nature of transaction; amount; date of receipt |
| 31(bb) | Receipts above the limit by cheque or bank draft that is not account payee | Name, address and PAN or Aadhaar of the payer; amount |
| 31(bc) | Payments above the limit, otherwise than by cheque, bank draft or electronic clearing system | Name, address and PAN or Aadhaar of the payee; nature of transaction; amount; date of payment |
| 31(bd) | Payments above the limit by cheque or bank draft that is not account payee | Name, address and PAN or Aadhaar of the payee; amount |
Note the asymmetry: (ba) and (bc) require the nature of the transaction and the date; (bb) and (bd) do not. The non-account-payee sub-clauses ask only for the counterparty and the amount.
The common exclusion
Particulars at (ba), (bb), (bc) and (bd) need not be given in the case of:
- receipt by or payment to a Government company, a banking company, a post office savings bank or a co-operative bank;
- transactions referred to in section 269SS; or
- persons referred to in Notification No. S.O. 2065(E) dated 3 July 2017.
Clause 31(b) — specified sums on immovable property
Clause 31(b) deals with a "specified sum" taken or accepted in relation to transfer of an immovable property, whether or not the transfer takes place. Clause (iv) of the Explanation to section 269SS defines it as any sum of money receivable, whether as advance or otherwise, in relation to such a transfer.
Two points from paragraph 55.12 onwards are worth carrying into the audit:
- Reporting is required irrespective of whether the immovable property is held as a capital asset or as stock in trade. Developers are squarely within it.
- The auditor should ascertain whether any immovable property was transferred or proposed to be transferred during the year, review the agreements and documents, and satisfy himself that the proceeds were credited to the bank account by account payee cheque, account payee draft, electronic clearing system or a prescribed electronic mode.
Paragraph 55.15 records that the additional disclosures in clause 31(b)(ii), introduced by Notification No. 23/2025 dated 28.03.2025 with effect from 1 April 2025 and applicable to AY 2025-26 onwards, inadvertently refer to "Amount of each loan or deposit taken or accepted and code of the nature of such amount, as given in Note 1". Since clause 31(b) is about specified sums, not loans or deposits, the Guidance Note says the reference should be read as "specified sum", in alignment with the intent and scope of the clause. Report on that basis and note the reading in the working papers.
Note 1 codes
Notification 23/2025 also inserted Note 1 after clause 31, providing codes for the nature of the amount. Clause 31(b)(ii) requires the code alongside each specified sum, so the auditor must obtain and verify code-wise details of each specified sum received. The same code framework runs through the loan and deposit sub-clauses.
The recommended working paper for clause 31(b)
Paragraph 55.16 recommends the auditor maintain, in the format of the e-filing utility:
- Name of the lender or depositor
- Address
- PAN or Aadhaar of the person from whom the specified sum is received, if available
- Amount of specified sum taken or accepted
- Code of the nature of the amount, as given in Note 1
- Whether it was taken or accepted otherwise than by account payee cheque, account payee draft or electronic clearing system
- Where taken by cheque or draft, whether it was an account payee instrument
Worked example
A jeweller receives, in respect of a single wedding order from one customer:
- Rs 90,000 cash on 3 May;
- Rs 85,000 cash on 11 May;
- Rs 1,40,000 by crossed cheque not marked account payee on 19 May.
No single day crosses Rs 2 lakh. But the receipts relate to one event or occasion from one person, and aggregate to Rs 3,15,000. Section 269ST limb (c) is breached.
Reporting: the two cash receipts totalling Rs 1,75,000 are within clause 31(ba) with nature and dates; the Rs 1,40,000 non-account-payee cheque is within clause 31(bb) with payer and amount.
Audit checklist
- Test all three section 269ST limbs — per day, per transaction, and per event or occasion.
- Separate non-account-payee cheques and drafts from cash; they go to (bb) and (bd), not (ba) and (bc).
- Capture nature of transaction and date for (ba) and (bc).
- Apply the Government company, bank, post office savings bank, co-operative bank and section 269SS exclusions.
- For clause 31(b), review every immovable property agreement, including where the transfer did not go through, and whether held as capital asset or stock.
- Obtain Note 1 codes for each specified sum.
- Record the "specified sum" reading of clause 31(b)(ii) in the working papers.
Common mistakes
- Testing only the daily aggregate. Single transaction and event or occasion are separate limbs.
- Treating a crossed cheque as compliant. It must be account payee.
- Omitting advances on transactions that fell through from clause 31(b).
- Excluding stock-in-trade property from clause 31(b).
- Reporting section 269SS transactions in (ba) to (bd) — they are excluded.
- Reading clause 31(b)(ii) literally as loans and deposits.