Urgent.....pls help

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

15 May 2011 A notice served by the ITO that in the F/y 2006/07 we have made cash deposit of Rs. 11 lakh something in the bank A/c.
U have to appear on the said date with the some particulars,he had demanded.

The last line was written that if we fail to appear on the said date then further action as per law will be initiated against you and further no opportunity will be afforded to u.

-My question is what will be the further action as per law? as there is no reference of any section.

Pls explain with relevant case or section.

Thanks

U S Sharma

U S Sharma (Expert)
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15 May 2011 appear and show the source of money reconciled with your accounts,

as if you have deposited the money in bank , there must be cash in hand on specified dates.

if the statement is wrong then appear and produce evidence that you have not deposited such amount.

non appearence will make u convict and department will initiate evasion case against you.

Querist : Anonymous

Querist : Anonymous (Querist)

16 May 2011 Sir,the cash deposit made by the outstation debtors and the same were paid by us to the local suppliers in Delhi.

Sir,can u please explain in detail about the evasion Case?

pls

U S Sharma

U S Sharma (Expert)
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17 May 2011 make reconcilation of such transactions, and get confirmations from the depositors, also from the vendors to whom you paid,

if the ITO feel fit then they can ask the depositors to confirm the transaction( better get confirmations from them in advance)

without these, the money would be accounted in your hands and would be taxed as per rule.

if you avoid the notice then department would book the whole amount in your hands on which tax is not paid, and would proceed accordingly

as the amount is not so petty cash, do the reconcilation carefully and with evidence and confirmations.

in case they had to deposit, they had to use cheques, but cash transactions made it doubtful, now only their confirmations and your reconcilation would save the situation.

Querist : Anonymous

Querist : Anonymous (Querist)

24 May 2011 Thanks Sir for ur kind help

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