Cash payment
This query is : Resolved
27 April 2012
one of my client purchased a plot of land amounting to Rs. 10 lakh by paying cash. is it attract any penalty section under I. Tax Act?
28 April 2012
I think, if he is a individual not covered u/s 44ab and he can show the source of such cash, there is no problem.
But as cash payment exceeding Rs. 20,000/- is not allowed, he can face problem if assessment is made.
But as cash payment exceeding Rs. 20,000/- is not allowed, he can face problem if assessment is made.
28 April 2012
Thank you Mr. Gupta.
cash payment exceeding Rs. 20000/- disallowed under I.Tax Act for business expd. but under this situation the individual acquired capital asset i.e plot of land by paying cash. so, in my view it is nout of the perview of section 40)A)3.
Please comment.
cash payment exceeding Rs. 20000/- disallowed under I.Tax Act for business expd. but under this situation the individual acquired capital asset i.e plot of land by paying cash. so, in my view it is nout of the perview of section 40)A)3.
Please comment.
28 April 2012
yes, it is sectioned covered for business & profession but the section does not specified that Rs. 20000/- is limit for business expenditure. I have seen the cases where A O has enforce the section, if assessee has business income and spend cash for personal property.
Till the case is not in scrutiny, you will not face any problem. all depends on how AO views the case.
Till the case is not in scrutiny, you will not face any problem. all depends on how AO views the case.
28 April 2012
u can purchase land in cash.... there is no penalty if u purchase land in cash..
30 April 2012
AGREE WITH BIREN SHAH
01 May 2012
If the plot is purchased as stock in trade for business purpose it will be hit by sect40A(3), If purchased as investment no problem.
09 May 2012
Any investment is not considered as covered u/s 40A(3) and hence no problem
17 May 2012
land purchased as stock in trade for business purpose in real estate business ( Not as investment in plot) will be covered u/s. 40A(3), as purchase cost is treated as expenditure for business.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- About TDS & Income Tax
- Section 194JA & JB Income which ITR Form to use
- Pass word to open justification report for Q1 for FY 2026-27
- PPF interest-As Exempt Income disclosure
- Under construction property in ITR
- Scrutiny and reopening of past returns
- Booth for sales promotion
- Upload Level ValidationITR3Category of Defect B/D
- Building tax payment deduction in rental Income
- F & O PROFIT REPORTING FOR AY 2026-27
- Difference in GSTR3B system generated which is correct and actual Payment it asks
- Indian IT Portal issue in computing tax as per UK-India DTAA
- Capital Gains on sale of residential flat
- PF Taxable Income
- Clarification on Tax Audit Applicability and Reporting of F&O Transactions in ITR-3
- Interest credited in FY2025-2026 & TDS therein by EPFO does not reflect in AIS or Form 26AS
- 44ad eligble money lending interest
- Taxation in the hands of Landowner under JDA
- Delisted shares sold in off market/ Rebate u/s87A
- In Exports Sales HSN details where to fill
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
