Accepting payment for friend

I am from jamshedpur and one of my friend is from mumbai he sold his land for 10cr. in mumbai kolapur so now he don't have a current account to accept payment in his bank so he requested me to accept payment in my account as well as he is ready to pay all the taxes and everything else . so as i have a current account and my account have capacity to take that much amount can i accept payment on his behalf and how much tax i have to pay.
Replies (1)

Income tax law does not have any and allow any provision for accepting money on behalf of any friend.Firstly,  Any amount that a person receives upon sale of land is taxed as capital gains that would be paid by the receiver and secondly , when you transfer that money to your friend post payment of tax, it would be taxed again as Gift which would have to be paid by him. Also, since, the property is his, and you would receive the payment, this could also attract Benami Law and would land you and your friend in unnecessary trouble . Therefore,   I would not advise you not to accept such kind of payment on behalf of your friend and opening a bank account in his name would rather be an easier and better option. 

Thanks, 

CA Ruchika Bansal 

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