Cash payment for purchase of agri. land by auditable firm

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Krunal T Adhvaryu (Querist)

30 March 2013 Can anyone tell me whather a Auditible Partnership firm can make payment in cash for purchase of agriculture land??? And whather for purchase of any other fixed assets..???

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)

30 March 2013 For purchase of fixed assets section 40A(3) not applicable. So you can purchase agricultural land by cash.

OM SAI SRI SAI JAI JAI SAI

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Krunal T Adhvaryu

Krunal T Adhvaryu (Querist)

30 March 2013 Thank you very much sir,
But if my client is involved in the business of land developing than??
He is dealing in purchasing of agri. land and than sell it after developing it.

Dintakurthi Tirumala

Dintakurthi Tirumala (Expert)

30 March 2013 Then it comes under business catogery and he held such land is as stock in trade then section 40A(3) attracts. Because of section 40A(3) applicable for the goods purchased for the purpose of business.

OM SAI SRI SAI JAI JAI SAI

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