I have come across one client who runs a partnership firm in trading of medical equipment.
Partners very frequently withdrawing good amounts and putting into their other business and again bring back . Like that frequently transactions are taking place and most of time their account in main business shown debit balance of huge amount.
some time they transfer huge amount as loan to their friend circle and bring back after sometime.
I want to know legal provision on such transactions.
13 March 2020
Partners very frequently withdrawing good amounts and putting into their other business and again bring back . Such transactions no problem. Cash withdrawal and bring back should not be 2 lacs and above. Loans to friends should be treated as withdrawal and it should not be in cash exceeding the limit. Loans in the books of accounts not allowed.
CAclubindia
