A person shall not take any loan or deposit or specified sum from any person otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system if
- the amount of such loan or deposit or specified sum or the aggregate amount of such loan, deposit and specified sum or
- on the date of taking any such amount, the amount already taken and remains unpaid (whether due or not) or
- the aggregate amount of point (a) and (b) above
exceeds Rs. 20,000 or more.
Provided that the provisions of this section shall not apply to any loan or deposit or specified sum taken or accepted from, or any loan or deposit or specified sum taken or accepted by,—
- the Government;
- any banking company, post office savings bank or co-operative bank;
- any corporation established by a Central, State or Provincial Act;
- any Government company as defined in clause (45) of section 2 of the Companies Act, 2013 (18 of 2013);
- such other institution, association or body or class of institutions, associations or bodies which the Central Government may, for reasons to be recorded in writing, notify in this behalf in the Official Gazette:
These provisions also not applicable where both the parties (i.e payer and payee) have agricultural income and neither of them has any income chargeable to tax under the income tax act.