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Can balance with bank be more than gross turnover


Manu (Mr)     13 June 2019

Manu
Mr 
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Will there be a problem if i had more balance in bank at the end of financial year than income earned in previous year?

For example 

gross turnover E1(a) = 400000
balance in bank E21  = 700000

 

 

avater

Dhirajlal Rambhia (KVO Merau Kutchh)     13 June 2019

Dhirajlal Rambhia
KVO Merau Kutchh 
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Unless capital introduced by partners/proprietor in firm, it is not possible. ITD may raise a query.

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Dhirajlal Rambhia (KVO Merau Kutchh)     13 June 2019

Dhirajlal Rambhia
KVO Merau Kutchh 
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Unless capital introduced by partners/proprietor in firm, or loans or payable to creditors etc... it is not possible. ITD may raise a query.

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Manu (Mr)     13 June 2019

Manu
Mr 
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Thanks for your reply.

The balance was due to FD (fixed deposit) that matured. I did not renew the FD so there was some excess balance.

Should i leave the "balance in bank E21" column empty to avoid any problem?  it is not mandatory to fill that column.

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Dhirajlal Rambhia (KVO Merau Kutchh)     14 June 2019

Dhirajlal Rambhia
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Better to fill the column, as its explainable.

Manu (Mr)     14 June 2019

Manu
Mr 
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Ok.

In balance in banks (E21) column do i have to give the total income earned or whatever balance was there as on 31 march?

Also you mentioned  ITD may raise a query, is there any reason why ITD will raise a query? 
 

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Dhirajlal Rambhia (KVO Merau Kutchh)     15 June 2019

Dhirajlal Rambhia
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Balance as on 31st March of relevant year.

High value transactions or bank balances are generally caught under ITC radar.

Manu (Mr)     15 June 2019

Manu
Mr 
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Ok thanks your reply.

Ajay Gupta (PRACTICING CHARTERED ACCOUNTANT)     19 June 2019

Ajay Gupta
PRACTICING CHARTERED ACCOUNTANT 
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Dear Manu - In normal scenario bank balance would be less than or equal to turnover. There must be some abnormal transactions, which would have increased the bank balance.

Please possess appropriate documentation for these transactions and do ensure appropriate treatment in ITR. If these two things are followed by heart, then we can respond to any sort of query from the IT department. 

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sasi Tamil   03 July 2019

sasi Tamil

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