Unsecured loan receivable

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This discussion explores the income tax implications of showing an unsecured loan as received via cash when the payee might refuse to pay. It highlights the potential consequences under Section 269T of the Income Tax Act, particularly concerning penalties for cash transactions. The conversation also touches upon the difficulty of proving cash receipt if the payer later denies it, potentially leading to issues with unaccounted money.

Mahabir Prasad Agarwal

Mahabir Prasad Agarwal (Querist)

26 September 2024 If any payee refuse to pay my unsecured loan and if I show the said unsecured loan as Received Vide Cash, what consequences may arise in income tax sir ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

26 September 2024 Check sec. 269T IT act.

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Mahabir Prasad Agarwal

Mahabir Prasad Agarwal (Querist)

26 September 2024 Sir, does not section 269T impose penalty only on person who pays the amount in cash ? I f I show my loan as received in cash, whether any penalty can also be imposed on me ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

26 September 2024 That is what I want to specify, when he will be queried about the loan repayment (& hence penalty) he will deny the fact, In that case you will be caught for unaccounted money & hence legal consequences.

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Mahabir Prasad Agarwal

Mahabir Prasad Agarwal (Querist)

26 September 2024 My acknowledgment (with a proper money receipt) and hi denial ! Which will prevail ?

Dhirajlal Rambhia

Dhirajlal Rambhia (Expert)

26 September 2024 You acknowledgement for cash receipt can be easily denied by payer.

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Mahabir Prasad Agarwal

Mahabir Prasad Agarwal (Querist)

26 September 2024 Thanks for your quick suggestion sir.

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