No tax on cash sales of agricultural produce for less than 2 lakhs rupees

According to the Income Tax (IT) Department circular, the cash sales of agricultural produce by a cultivator to a trader for less than 2 lakh rupees will not attract tax under the Income Tax Act.The cultivator and the trader will also not have to provide their Permanent Account Number or furnish Form 60.The clarification came following representations from stakeholders about applicability of income tax provision to cash sale of farm produce by farmers to traders.

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