Form 3CD Clause 30 for AY 2026-27: Hundi Loans, Section 69D & Reporting

Form 3CD Clause 30 for AY 2026-27 requires a tax auditor to report details of any amount borrowed on a hundi, or any amount due on a hundi (including interest) that is repaid otherwise than through an account-payee cheque. The reporting is linked directly to Section 69D of the Income-tax Act, 1961. For FY 2025-26 / AY 2026-27, the existing Form 3CA/3CB with Form 3CD framework continues to apply, and the ordinary tax-audit report due date is 21 October 2026.

Update — 28 September 2026: CBDT changed the specified ordinary AY 2026–27 tax-audit report deadline from 30 September to 21 October 2026 and the related audited return deadline from 31 October to 21 November 2026. Transfer-pricing Form 3CEB remains separate. Official Income Tax Department announcement.

Form 3CD Clause 30 AY 2026-27: what exactly must be reported?

Clause 30 is narrow, but the consequence behind it is severe. The prescribed Form 3CD asks for details of an amount borrowed on hundi, or an amount due thereon—including interest—repaid otherwise than through an account-payee cheque. The clause is therefore not a general cash-loan disclosure. It is a specific audit disclosure tied to the special deeming rule in Section 69D.

Section 69D provides that where an amount is borrowed on a hundi from any person, or an amount due on that hundi is repaid to any person, otherwise than through an account-payee cheque drawn on a bank, the amount borrowed or repaid is deemed to be income of the person borrowing or repaying it in the relevant previous year. The statutory explanation makes clear that repayment includes interest paid on the amount borrowed.

Why Clause 30 matters even though hundi transactions are less common today

Many businesses may rarely encounter a traditional hundi in modern banking operations. That does not make Clause 30 irrelevant. Tax-audit procedures still need to establish whether any financing instrument or legacy trade-finance arrangement in the books is in substance a hundi and, if so, whether the borrowing or repayment route satisfies Section 69D. A “nil” conclusion should therefore come from an informed review rather than from automatically treating the clause as obsolete.

This is particularly relevant in businesses with legacy family financing, traditional market credit, old-style bills, informal financing records, or balances carried forward for many years. The auditor should understand the legal character of the instrument rather than rely only on the ledger description used by the assessee.

Section 69D: the tax consequence

The Section 69D consequence can arise at two different stages. First, if money is borrowed on a hundi otherwise than through an account-payee cheque, the borrowing itself can be deemed income in that year. Second, if an amount due on the hundi is repaid otherwise than through an account-payee cheque, the amount repaid can be deemed income in the year of repayment.

There is an important protection against double taxation in the proviso. If an amount borrowed on hundi has already been deemed income under Section 69D, the same person is not liable to be assessed again under Section 69D when that amount is subsequently repaid. This does not remove the need to maintain a clear year-wise audit trail showing what amount was previously brought within the section and what amount is now being repaid.

Clause 30 is different from Clause 31

Clause 30 is frequently confused with Clause 31 because both concern financing and payment modes. They serve different statutory purposes. Clause 30 is specifically linked to hundi borrowing and repayment under Section 69D. Clause 31 deals with loans, deposits and specified sums under Sections 269SS, 269T and related cash-transaction reporting. A transaction may need analysis under more than one provision depending on its legal form and facts, but the clauses should not be mechanically merged.

PGT & Associates has a separate discussion of Form 3CD Clause 31 and Sections 269SS, 269ST and 269T in the Tax Audit AY 2026-27 cluster. The broader Tax Audit AY 2026-27 hub is available at https://www.pgtandassociates.com/post/tax-audit-ay-2026-27-forms-deadline.

Practical example: cash repayment of a hundi

Assume a business had borrowed ₹8,00,000 on a hundi and later repaid ₹8,00,000 of principal plus ₹60,000 of interest in cash during FY 2025-26. If the facts bring the instrument within Section 69D, the repayment route is the core problem: repayment was not made through an account-payee cheque. The statutory explanation includes interest in the amount repaid, so the audit review cannot focus only on principal. The tax team must also check whether the original borrowing had already been deemed income under Section 69D in an earlier year, because the proviso can affect whether the principal is again assessable on repayment.

The example is deliberately simplified. The actual result depends on the instrument, the earlier-year history, the payment route and the evidence available. Clause 30 reporting should therefore be supported by transaction-level documentation rather than a generic management representation alone.

Eight checks before finalising Form 3CD Clause 30

1. Review loan, bill-discounting, traditional finance and legacy creditor ledgers for references to hundi, hundi loan, hundi interest or similar terminology. 2. Obtain the underlying instrument where a ledger entry could represent a hundi. 3. Identify the date and amount of every relevant borrowing during FY 2025-26. 4. Trace each repayment, including interest, to the bank or cash book. 5. Confirm whether the payment instrument was an account-payee cheque drawn on a bank. 6. Check prior-year tax-audit files and assessment records for any amount already deemed income under Section 69D. 7. Reconcile the amount reported in Clause 30 with the general ledger and the income-tax computation. 8. Preserve the instrument, bank proof, ledger extract and management explanation in the tax-audit working papers.

Common mistakes in Clause 30 reporting

One common mistake is to treat Clause 30 as merely another cash-loan threshold clause and apply the monetary limits used for Sections 269SS or 269T. Section 69D is a different deeming provision and Clause 30 does not use those thresholds. Another mistake is ignoring the interest component even though the statutory explanation expressly includes interest in repayment. A third is failing to examine the earlier-year history, which can matter because of the proviso preventing the same borrowed amount from being assessed again on repayment after it has already been deemed income under Section 69D.

A further risk is over-reporting ordinary trade bills or informal loans as hundis without first establishing the character of the instrument. The correct approach is legal and factual classification first, followed by the Section 69D payment-mode test.

AY 2026-27 transition: Form 3CD still applies

For FY 2025-26 / AY 2026-27, tax audit continues under the Income-tax Act, 1961 using Form 3CA or Form 3CB together with Form 3CD. The Income Tax Department has confirmed that the ordinary tax-audit report due date for AY 2026-27 is 21 October 2026. The new unified Form 26 belongs to the Income Tax Act, 2025 framework for Tax Year 2026-27 and does not replace Form 3CD for FY 2025-26.

FAQs on Form 3CD Clause 30

Does Clause 30 apply to every cash loan?

No. Clause 30 specifically concerns amounts borrowed on hundi or amounts due thereon that are repaid otherwise than through an account-payee cheque. Other loan and deposit restrictions are addressed separately, including through Clause 31.

Is there a ₹20,000 or ₹2 lakh threshold for Clause 30?

Clause 30 itself is tied to Section 69D and should not be tested using the separate thresholds applicable to Sections 269SS, 269T or 269ST.

Does interest paid on a hundi count for Section 69D?

Yes. Section 69D expressly states that the amount repaid includes interest paid on the amount borrowed.

Can the same amount be taxed once on borrowing and again on repayment?

The proviso to Section 69D states that if the amount borrowed on hundi has already been deemed income under Section 69D, that person is not liable to be assessed again under the same section in respect of that amount on repayment.

What is the tax-audit deadline for AY 2026-27?

For an ordinary FY 2025-26 tax-audit case, the Income Tax Department confirms 21 October 2026 as the audit-report due date. Special cases, including transfer-pricing reporting, require separate deadline analysis.

Practical takeaway

Form 3CD Clause 30 is a specialised disclosure, but it should not be skipped automatically. The strongest audit file will identify whether any hundi exists, trace borrowing and repayment modes, include interest, test prior-year Section 69D history, and reconcile the result with the tax computation. Where the facts are unclear, classification of the instrument should be resolved before the Form 3CD position is finalised.

For businesses preparing for Tax Audit AY 2026-27, PGT & Associates can assist with Form 3CD clause-level reconciliation, tax-audit readiness and documentation reviews. Professional advice should be based on the specific facts and records of each taxpayer.

Primary references

Income-tax Act, 1961 — Section 69D, Amount borrowed or repaid on hundi. CBDT Notification No. 33/2014 prescribing Form 3CD Clause 30. Income Tax Department — 2026 forms guidance confirming Forms 3CA/3CB/3CD for FY 2025-26 / AY 2026-27 and the ordinary 21 October 2026 tax-audit report deadline.

Disclaimer: This article is for general professional information and does not constitute tax, legal or accounting advice. Statutory interpretation and compliance should be evaluated against the taxpayer’s facts, records and current law.