Organization paying contractors in cash

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not
68 Points Posted on 29 February 2020

An organization has some contractors working along with some employees. The organization wants to pay the contractors their salary by cash and that salary come in lakhs. What are the various consequences the contractors face for taking the money in cash in lakhs from organization?

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On 29 February 2020 at 20:03 Report
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This discussion explores the potential negative consequences for contractors receiving substantial cash payments from an organisation, particularly concerning Indian tax laws. It questions whether receiving cash payments, even if below certain thresholds like Rs. 2 lakh per day or per transaction, might still lead to penalties, fines, or even imprisonment under provisions like Section 269ST of the Income Tax Act. The core concern is the tax disallowance of such expenses for the paying organisation and the risks faced by the contractor.

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Manger Accounts & Finance
363 Points Posted on 29 February 2020
This expenses disallowed in Income tax.
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On 29 February 2020 at 20:52
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not
68 Points Posted on 29 February 2020

Hi Sohan

It is not answering my query that what various negative consequences a contractor can face like penalties, imprisonment etc for receiving payment in lakhs from the organization. So please reply that. Your current reply is not completely answering that.

Thanks,

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On 29 February 2020 at 21:01
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Manger Accounts & Finance
363 Points Posted on 29 February 2020
If contractor Invoice value below 200000 than Contractor to be receive upto 200000 in cash against our services services.
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On 29 February 2020 at 21:06
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not
68 Points Posted on 29 February 2020

Is it that a contractor can receive Rs. 200000 per day from the organization and the contractor will not face any negative consequence like fines imposed, imprisonment etc for that?

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On 29 February 2020 at 21:12
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Manger Accounts & Finance
363 Points Posted on 29 February 2020
PROVISION OF SECTION 269ST:

No person shall receive an amount of two lakh rupees or more—

(a) in aggregate from a person in a day; or

(b) in respect of a single transaction; or

(c) in respect of transactions relating to one event or occasion from a person
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On 29 February 2020 at 21:27
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not
68 Points Posted on 02 March 2020

Does it mean that under section 269ST a contractor can receive RS. 200000 per day from the organization and the contractor will not face any negative consequence like fines imposed, imprisonment etc for that?

the organization and the

Read more at: https://www.caclubindia.com/forum/organization-paying-contractors-in-cash-543710.asp
the organization and the

Read more at: https://www.caclubindia.com/forum/organization-paying-contractors-in-cash-543710.asp
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On 02 March 2020 at 20:14
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not
68 Points Posted on 02 March 2020

CAN OTHERS ALSO REPLY TO THIS POST?

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On 02 March 2020 at 20:45
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not
68 Points Posted on 15 March 2020

Can anybody reply to this?

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On 15 March 2020 at 21:13

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