Rule 6DD states the exceptions to provisions of Section 40A (3). The following list of exceptions are:
When the payment is made to:
- RBI (Reserve Bank of India) or another bank
- SBI or its subsidiaries
- Land mortgage bank or Co-operative bank
- Life Insurance Corporation of India
Where the payment is made by:
- Letter of Credit Arrangements through a bank
- Mail or telegraphic transfer
- Adjustment made in the book from any account in a bank to any other account in that or any other bank.
- Bill of exchange made only payable to a bank.
- Credit/Debit card
- ECS - Electronic Clearing System
Where the payment is made to a cultivator for the purchase of:
- Agricultural or Forest Produce
- Produce of Animal Husbandry (livestock, meat, hides, skins)
- Fish or Fish Products
- Products of Horticulture/Apiculture
Payment made towards procurement of products manufactured by cottage industries (without electrical power).
Payment made to an individual residing or carrying our business in a town/village (not served by a bank).
When payment is made to the government in legal tender under specified rules.
Payment made by an assesse in relation to the salary paid after deducting the income tax.
In such a situation:
- The employee should be posted temporarily for 15 days or more, outside his/her normal place of duty.
- The employee should not have an active bank account, serviceable at the place of posting/ship.
When the payment is made on a day of bank holiday.
When the payment is made by the assesse to purchase foreign currency or travellers cheques.
When the payment is made by the assesse to their agent for procuring goods or services on behalf of the assesse.
