The cash transaction rules are among the most frequently breached provisions in Indian tax. In the Income-tax Act, 2025 they move from the 269 series into sections 185 to 188, with penalties in sections 450 to 453.
Quick answer: the mapping
| Income-tax Act, 1961 | Subject | Income-tax Act, 2025 |
|---|---|---|
| 269SS | Mode of taking loans and deposits | 185 |
| 269ST | ₹2 lakh cash receipt restriction | 186 |
| 269SU | Prescribed electronic payment modes | 187 |
| 269T | Mode of repayment of loans and deposits | 188 |
| 271D | Penalty for breach of 269SS | 450 |
| 271DA | Penalty for breach of 269ST | 451 |
| 271DB | Penalty for breach of 269SU | 452 |
| 271E | Penalty for breach of 269T | 453 |
The Income-tax Act, 2025 received Presidential assent on 21 August 2025 and takes effect from 1 April 2026. The Income-tax Act, 1961 continues to govern every tax year up to 31 March 2026, and all assessments, appeals, penalties and prosecutions relating to those years are completed under the old Act by virtue of the repeal and savings provision in section 536. The mapping on this page is drawn from the section-wise concordance published with the Act, including the corrigenda notified in the Gazette on 3 September 2025.
What the 1961 provision did
Section 269SS restricted taking loans, deposits and specified sums otherwise than by banking channel; section 269ST barred receiving ₹2,00,000 or more in cash in specified circumstances; section 269SU required prescribed electronic payment modes; and section 269T restricted repayment in cash.
Where it sits in the Income-tax Act, 2025
Chapter XII of the Income-tax Act, 2025 carries all four: section 185 (taking loans and deposits), section 186 (mode of undertaking transactions — the ₹2 lakh rule), section 187 (electronic payment modes) and section 188 (repayment). Section 189 is the interpretation provision.
What actually changed
- They get their own chapter. Chapter XII is short and dedicated, instead of being buried in the collection and recovery chapter of the old Act.
- The penalties line up in the same order: section 450 for a breach of section 185, 451 for section 186, 452 for section 187 and 453 for section 188.
- Section 189 carries the definitions drawn from sections 269SS, 269ST and 269T, so the meaning of loan, deposit and specified sum is in one place.
What to do about it
- Update internal cash-handling policies and audit checklists to the new section numbers.
- Statutory audit and tax audit observations should cite sections 185 to 188 for tax year 2026-27 onwards.
- Where a penalty notice is received, check whether the year falls under the 1961 Act or the 2025 Act before framing the reply.
The sections around it in the new Act
Renumbering is easier to absorb in context. The table below lists the neighbouring provisions of the Income-tax Act, 2025 with the 1961 sections each of them carries forward, so you can see where this provision sits and what moved with it.
| New section (2025) | Provision | Corresponding 1961 section(s) |
|---|---|---|
| 185 | Mode of taking or accepting certain loans, deposits and specified sum | 269SS |
| 186 | Mode of undertaking transactions | 269ST |
| 187 | Acceptance of payment through prescribed electronic modes | 269SU |
| 188 | Mode of repayment of certain loans or deposits or specified advances | 269T |
| 189 | Interpretation | 269SS, 269ST, 269T |
How to read a section mapping
- A corresponding section is not always an identical section. Where several 1961 sections map to one new section, conditions that used to sit apart are now read together.
- Where one 1961 section maps to several new sections, the old provision was split, and each new section carries only part of what you used to cite.
- Some new sections have no 1961 equivalent at all — the registered non-profit code in sections 332 to 355 is the largest example.
- Always cite by year. The Act that applies is decided by the tax year in question, not by the date you are writing on.
This page is a structural mapping guide, not tax advice. A corresponding section is not always an identical section — several provisions were merged, split or re-worded when they were carried over. Always read the actual text of the new section before relying on it, and check for later amendments, rules and CBDT notifications.