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Receiving Cash from Customer

Vaishnavi (CA- Final) (95 Points)

15 November 2016

Hi ,
can i receive cash from customer say 5lac , which are due from them , we r in business and now customer wants to pay in cash to us and are asking us to deposit in our account.. can we receive cash or is there a format for to receive cash.. pls do reply at earliest

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10 Replies

CA VIRAL SANGHVI (Finance head) (681 Points)
Replied 15 November 2016

AS PER SECTION 40 A(3) ONE CAN NOT DO PAYMENT MORE THAN 20,000 IN CASH BUT IF YOUR PARTY IS READY TO PAY SAY 5 LACS THAN ACCEPT IT.

Please deposit it in installments in current account i.e. bifurcate it in 4 installment.

1 Like

Dharmesh (Student) (1025 Points)
Replied 15 November 2016

You will get old notes or new ones ?

CMA Poornima Madhava (CMA) (13097 Points)
Replied 15 November 2016

You may receive Rs.5 lacs from your customer in cash but you need to collect tax at source @ 1% to the extent such value exceeds Rs.2 lacs (provided you have PAN) and file TCS return accordingly

2 Like

Vaishnavi (CA- Final) (95 Points)
Replied 15 November 2016

he is a debtor and he is willing to pay cash in lacs .. my auditor suggested that " a balance confirmation declaration can be obtained .. but others says that cash shouldn't be taken and deposited in account as it ll be taken under scrutiny by IT ,no matter the declaration by customer

Vaishnavi (CA- Final) (95 Points)
Replied 15 November 2016

old notes will only be paid by him

Dharmesh (Student) (1025 Points)
Replied 15 November 2016

firstly as per my knowledge you cannot accept old notes from 8th night...no question of depositing these if ur records show that received after 8th..

1 Like

CA Sultan.........never quits (Financial Controller) (511 Points)
Replied 15 November 2016

Ask them to depsoit their account and take a DD and give it to you. Demonetaisation of 500 and 1000 Rs bank notes are effect from 8 th night. So, now you can not accept cash.

Only specific organisations can receive old bank notes un till 24. Are you coming under specific organisation?

1 Like

J. K. Ratan (Compliance Advisor) (794 Points)
Replied 15 November 2016

Dear Professionals

After 12:00 of 8th november 1000 & 500 note ceased to be legal tender in open market.

So acceptance of 1000 or 500 denominations is totally illegal

and deposit in single or multiple transaction don't arise.

1 Like

kcagarwal (chartered accountant) (103 Points)
Replied 15 November 2016

in my view, after 8th nov.2016, old note of Rs.500.00 and Rs.1000.00 are no legal tender, how it can be accepted after 8th nov 2016

k c agarwal

2 Like

Alok sharma (Business) (3 Points)
Replied 17 November 2016

but i can say if you have done a court case against that debtors for collecting the debts and that debtors gives you cash through court than may be you can collect and deposit... in my view. tell me if i am wrong .