08 July 2009
A buyer had given advance for goods to a firm. But the sale was not made. Instead the money was paid back in cash exceeding Rs.20000. Would this amount be disallowed. If so is it u/s 269T or any other section?
08 July 2009
Hi, There will be no disallowance either u/s. 40A or u/s. 269T. You have to take care, to pass the entries properly in the books of accounts with full narrations. Also keep ready the related vouchers & bill with detail of transactions to prove the guineness of the transaction. Many times it happens in the case of builders where they accept the cash as an agreement to sale the house but afterwards transaction doesnot materialise in sale and money is refunded back. Sec. 269T or Sec. 40A not applicable in such cases. It is neither loan taken nor you have debited any expenditure in profit & loss account for this transaction.
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