In order to provide some relief to hospitals treating covid patients, the central government has eased income tax norms for the Covid hospitals, dispensaries, nursing home and Covid care centres of similar facilities for receiving cash of Rs 2 lakh or above from the patients.
In a notification issued by the Ministry of Finance issued in this regard on Friday, it was announced that a relaxation for the Covid Care hospitals in Section 269ST of the Income Tax Act will be provided. But, the exemption for cash payment receipt is for the period of 1st April 2021 to 31st May 2021 only.
Informing about the same, Income Tax Department also tweeted and said, “Granting further relief in view of severe Covid pandemic, provisions of section 269ST of Income-tax Act,1961 relaxed by the Central Govt. Allows Hospitals/Medical facilities etc providing Covid treatment to patients to receive cash payments of Rs. 2 lakh or more,” adding, “Relaxation granted for the period 01.04.2021 to 31.05.2021, after obtaining PAN or AADHAAR of patient & the payer.”
The Department of Revenue at the Ministry of Finance issued a notification in this regard and said, “The central Government, in exercise of powers conferred by clause (iii) of Provision to Section 269ST of the Income-tax Act, 1961, hereby specifies hospitals, dispensaries, nursing homes, Covid Care Centre or similar other medical facilities providing Covid treatment to patients for the purpose of Section 269ST of Income-tax Act, 1961 for payment received in cash during 01.04.2021 to 31.05.2021, on obtaining the PAN or Aadhaar of the patient and the payee and the relationship between the patient and the payee by such hospitals, dispensaries, nursing homes, Covid Care Centres or similar other medical facilities.”
The notification clearly states that for the purpose of cash receipt over Rs 2 lakh, three conditions need to be fulfilled. PAN and Aadhaar of the patient is a must. If the payment is being made by a relative of the patient, then PAN and Aadhar of the payee will be mandatory for such payments. Also, the relationship of the payee with the patient has to be declared.
The decision comes after Delhi High Court has asked the govt to consider relaxing the cash transaction cap of Rs 2 lakh to help COVID patients.
