Property transaction in cash

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sandeep (Querist)
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28 October 2011 Is it possible/ acceptable to receive part of the sale deed amount(say upto Rs.one lac) in cash if it is properly mentioned in the sale deed document?
With best Regards

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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29 October 2011 Yes. Cash can be received in property transactions and there is no problem as the amount of cash is being mentioned in the sale deed.

Further such transactions are out of the scope of Section 40A(3).

sandeep

sandeep (Querist)
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29 October 2011 Some people insist that there is a limit of Rs.20,000/- or Rs.50,000/- per day for cash tranactions ar per IT Act. Please clarify.
Regards

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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29 October 2011 The limits prescribed
(as I mentioned U/s 40A(3))
for expenditure in connection with any business or profession.
.

Property transaction may be treated as a business in case you are a dealer in property. Further, a dealer in property can even receive his payment in cash. So, do not worry, accept cash and sign the sale deed.

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