Mode of repayment of certain loans or deposits [Section 269T] :

Section 269T provides that no branch of the banking company or a co-operative bank or any other company or co-operative society or a firm or other person, shall repay any loan or deposit made with it or any specified advance received by it otherwise than by account payee cheque or account payee bank draft, drawn in the name of the person who has made the loan or deposit or paid the specified advance, or by use of electronic clearing system through a bank account, if –

(i) the amount of loan or deposit or specified advance together with interest, if any, payable thereon; or

(ii) the aggregate amount of such loans or deposits held by such person with the branch of the banking company or co-operative bank or, as the case may be, the other company or co-operative society or the firm, or other person either in his own name or jointly with any other person on the date of such repayment, together with the interest , if any, payable on such loan or deposit; or

(iii) the aggregate amount of the specified advances received by such person either in his own name or jointly with any other person on the date of such repayment together with interest, if any, payable on such specified advances

is Rs 20,000 or more.

However, where the repayment is made by a branch of bank or a cooperative bank, such repayment could be made by crediting the amount of such loan or deposit to the saving bank account or the current account, if any, with such branch of the person to whom such loan or deposit has to be repaid.

Further, the provisions of this section shall not apply in case of repayment of any loan or deposit or specified advance taken or accepted from –

(i) Government;

(ii) any banking company, post office savings bank or co-operative bank;

(iii) any corporation established by a Central, State or Provincial Act;

(iv) any Government company as defined in section 617 of the Companies Act, 1956;

(v) 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.

For the purposes of this section and 269SS, the expression “banking company” will mean a company to which the Banking Regulation Act, 1949 applies and includes any bank or banking institution referred to in section 51 of that Act. The expression “co-operative bank” will have the meaning assigned to it in Part V of the Banking Regulation Act, 1949. ‘Loan or Deposit‘ means any loan or deposit of money which is repayable after notice or repayable after a period. In the case of any person other than a company, loan or deposit of any nature will be covered by this section.

“Specified Advance” means any sum of money in the nature of advance, by whatever name called, in relation to transfer of an immovable property, whether or not the transfer takes place.

Section 271E provides for penalty for failure to comply with the provisions of section 269T – If a person repays any loan or deposit or specified advance referred to in section 269T otherwise than in accordance with the provisions of that section, he shall be liable to pay, by way of penalty, a sum equal to the amount of the loan or deposit or specified advance so repaid.