If you are planning to purchase a home, you should know a simple real estate guideline. You cannot purchase a home with transactions of more than 20,000 in cash. The income tax agency might send you a straight notification if you overspent on the real estate purchase by up to 20,000.
In addition, Section 269T of the IT Act mandates that if the property transaction is canceled, even after returning the money, the transaction must be completed by cheque if it exceeds Rs 20,000. You'll also be charged a 100% penalty on the amount of the payback made in cash here.
Two things to remember.
1. Farmers who sell their land but have no other income subject to tax do not fall under this section.
2. Second, you must notify the income tax authorities of any transaction involving an immovable property valued at Rs 30 lakh or more.