Explanation
Section 269T is the repayment counterpart to §269SS. While §269SS controls how a loan or deposit is accepted, §269T controls how it is repaid. Any repayment of a loan or deposit — or interest on such loan or deposit — where the aggregate amount owed to the person (including the current payment) is ₹20,000 or more must be made exclusively via account payee cheque, account payee bank demand draft, or electronic clearing system. Even if the original loan was taken in cash (in violation of §269SS), the repayment must still be made through banking channels to avoid §269T violation. The penalty under §271E is equal to the amount of the repayment — 100%. Cash repayment of even a small balance that takes the cumulative running balance above ₹20,000 can trigger the provision. The same exceptions as §269SS apply: government, banking companies, post office savings banks, co-operative banks, NBFCs. Assessees often fall into this trap while repaying old family loans — ensure all repayments, even of informal family borrowings above ₹20,000, are made through banking channels and have proper documentation. Verify on the income-tax portal before filing.