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Bankers cheque is treated as cash?

Tax queries 272 views 1 replies

david

Student CFA

40 Points Joined March 2015

hello,

i have to pay an instalment to a site i am purchasing. The value of the site is 18 lakhs. I am told to pay an advance of 6 Lakhs Bankers cheque/DD.

I wanted to check what is the amount beyond the bank will send AIR or report it to IT.

Are there any new thresholds issues for bankers cheque/DD issued after demonatisation.

Should i split the bankers cheque to 3 + 3 or 2 * 3

I went to a bank - They told me you give a cheque as self and we will issue a bankers cheque. I did not undestand this. Is this transaction treated as Cash Transaction.

I want to avoid cash transaction and i dont want to get into trouble.

please advice me.

Replies (1)

Dhirajlal Rambhia

SEO Sai Gr. Hosp.

210815 Points Joined July 2016

No. Banker's cheque is as good as DD, and not treated as cash. The receiving party accept it with full confidence that the same is issued by Bank (on your behalf, of course) and hence it will not get returned.

Not only that, your account gets reduced by cheque amount which you issue to Bank, and there is no cash involved in the transactions.