Live Course on Drafting of Appeal and Reply of Penalty Notice by CA Sachin Sinha. Register Now!!

Need advise on cash deposit limit

Digi (Manager) (25 Points)

08 June 2015

Hi,

Can any expert guide me on my below situation.

I have liquidated FD's worth 7 lacs and self-withdrawn from my a/c by cheque in May 15 for personal need.

Can I deposit the same amount of cash in my bank account ? Will it be a cross entry, or it will be counted as an income for the FY15-16.

Reply
Follow
Share

7 Replies

CMA Poornima Madhava (CMA) (13097 Points)
Replied 08 June 2015

It won't be considered as your income again, if it is originally taxed.

CS krishna sharma (article assitant) (28 Points)
Replied 09 June 2015

More the section 40 (A)3 of income tax act 1961 does not apply for banks

Chaitanya (CA) (35 Points)
Replied 09 June 2015

If the amount has suffered tax earlier then need not worry on tax issues w.r.t interest component if you have filed your annual returns and considered it to be the income,then no tax would be attracted on the same.

Ashok kumar T (Articles ) (40 Points)
Replied 09 June 2015

noo it won't effect any tax proceedings

sunil (articals student) (37 Points)
Replied 09 June 2015

If you had already shown FD in your previous returns and intereste income was also filed in returns then there iwill be no tax effect... Further to that if you can prove that chash withdrawal & deposit both r same then also there will be no tax.. If ur total deposits exceed 10L per annum they there will be verification letter from department, so pls ensure that there is no cash deposits for than 10L in one F.Y.

Digi (Manager) (25 Points)
Replied 09 June 2015

Thank you very much for the clarification.

To be clear on this, I can deposit it back without any tax liability.

but Can I deposit it in FY16 ? I.E after April 1st 2016, ( withdrawl taken place in FY15)

Thanks, this will clear my all doubts.

CMA Poornima Madhava (CMA) (13097 Points)
Replied 09 June 2015

Since it is your own money and that too bcoz it was originally taxed, you can redeposit it anytime. If possible avoid, cash transactions while depositing such sum.