Amit Jain (Proprietor ) 16 October 2019
Whether the balance of retiring partner transferred to loan a/c to be reported in Sec 269SS in 3CD and whether the repayment to partner after retirement to be reported in Sec 269ST in 3CD.
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Suresh Thiyagarajan (Student) 16 October 2019
1. First with respect to sec 269SS which deals with loan or advance or any sum of money which is accepted through cash.
2. If the amount is transferred to the firm's partners account then such loan or advance will not be covered u/s 269SS. Since it is merely a book entry and sec 269SS only deals with assessee's acceptance to loans or advances in cash exceeding Rs. 20,000.
3. So the above transaction shall not be reported.
4. Now, with respect to repayment of a loan to retiring partner. Sec 269ST deals with the receipt of the amount in cash in excess of Rs. 2 lakhs in a day for a single transaction in a day. This also deals with the receipt in cash. This also will not be covered u/s 269ST.
5. Either of your two transactions needed to be reported in form 3CD.
Please correct me if the above solution has an alternative view.
Kapadia Pravin 19 October 2019
In so far as repayment is concerned , if payment to retired partner is in cash by more than 20000/- then you are hit by 269T
Yes, this is to be reported in Form 3CD
And have to face penalty ,(unless prescribed acceptable reasons are given) which is as high as equivalent to loan amount.