HELLO FRIENDS, MY CLIENT IS A PROPRIETOR OF HIS FIRM AND HE IS ALSO PARTNER IN ANY OTHER FIRM.
DURING THE PREVIOUS YEAR BOTH FIRMS HAD PURCHASED SOME GOODS FROM EACH OTHER.
PLS. HELP ME HOW TO REPORT U/S 40A2.
BECAUSE THEY BOTH ARE RELATIVES.
PLS. HELP ME.
THANKS.
Dear Rajkumar,
in accordance with Sec. 40A(2), any excessive payment made to the relative (definition as applicable for this section) then only such excess shall be disallowed. Other part of the sum is allowed...
The comparision shall be made with the noramal transactions made with the other parties to each other.. If there do exists the difference then such amount alone is disallowed..
Regards,
Srikanth.M.S
Naveen Fintech Pvt Ltd
Kolkata
CA Inter
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