Purchase of share in cash

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This discussion clarifies the rules around purchasing shares in a private limited company using cash. While Section 269ST of the Income Tax Act limits cash payments to ₹2 lakh per day, it doesn't restrict receiving share application money via bank transfer. Therefore, bank transfers are a permissible method for such transactions without specific limitations.

SHYAM KRISHNAN K

SHYAM KRISHNAN K (Querist)
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23 July 2022 Is there any restriction on purchase of shares of private limited company in cash.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 July 2022 Cash payment should not exceed 2 lacs as per section 269ST of income tax Act.

SHYAM KRISHNAN K

SHYAM KRISHNAN K (Querist)
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23 July 2022 Its ok. This restriction only for receiving 2 lakh above in a single day. I want to know that, is there any provision in the act regarding receiving of share application money by bank transfer only.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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23 July 2022 No restriction on case of bank transfer.

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