269t & 271e
This query is : Resolved
09 June 2012
hello Everybody,
I have a query regarding applicability as to Sec 269T & Sec 271E.
My client engaged in a partnership firm containing 4 partners Say A,B,C,D in P.Y. 2 of them retired(Say A,B) & remaining continued the business as such,while calculating their dues (Retiring ones) All the partners took over the deposits to be repaid, by transferring (through Journal entry)them to their Respective Capital Accounts. All this conditions are mentioned in the agreement.will this tantamount to Violation of 269T??? or the Penalty u/s 271E is obvious?? pls reply soon
I have a query regarding applicability as to Sec 269T & Sec 271E.
My client engaged in a partnership firm containing 4 partners Say A,B,C,D in P.Y. 2 of them retired(Say A,B) & remaining continued the business as such,while calculating their dues (Retiring ones) All the partners took over the deposits to be repaid, by transferring (through Journal entry)them to their Respective Capital Accounts. All this conditions are mentioned in the agreement.will this tantamount to Violation of 269T??? or the Penalty u/s 271E is obvious?? pls reply soon
09 June 2012
Payment through Account Payee Cheque is possible only when Actual Payment is made. Journal entries are not tantamount to actual payment.
.
In the above case, when the retiring partners are paid before or at the time of retirement, they remains partners and even cash payment can be made to them. But, when the sum is payable afterwards, it should be repaid by account payee cheques only, as the nature of the Deposit in firm's books changes from Capital to Unsecured Loan.
.
In the above case, when the retiring partners are paid before or at the time of retirement, they remains partners and even cash payment can be made to them. But, when the sum is payable afterwards, it should be repaid by account payee cheques only, as the nature of the Deposit in firm's books changes from Capital to Unsecured Loan.
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