06 July 2023
Sir, one of my client lent Rs. 5.00 as unsecured loan to his friend. The friend neither refund the loan nor pays any interest to my client. My client has already written off the said loan in his mind. But for income-tax purpose, can my client show the loan as received vide cash ? Will there be any any complication in income -tax, if my client shows the said loan as received in cash ?
06 July 2023
No person shall take or accept from any other person, any loan or deposit or any specified sum, otherwise than by an account payee cheque or account payee bank draft or use of electronic clearing system through a bank account, if –
the amount of such loan or deposit or specified sum or the aggregate of the loan or deposit or specified sum, or on the date of taking or accepting such loan or deposit or specified sum, any loan or deposit or specified sum accepted earlier by such person from the depositor is remaining unpaid, or the aggregate amount of loan or deposit or sum mentioned in clause (a) together with the amount or the aggregate amount mentioned in clause (b), is twenty thousand rupees or more.
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