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Cash investment

Ajit Choudhary (32 Points)

12 October 2019

Can a Partner cash invest in his Partnership firm. Approximate 13 to 15 Lac. please guide me as soon as.

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4 Replies

ajeet singh (1392 Points)
Replied 12 October 2019

Not in at once cash receipt of 2.5lakh only

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sabyasachi mukherjee (27682 Points)
Replied 13 October 2019

A partner can invest in his own firm.
It will be treated as a loan to the firm or he may introduce fresh capital.
Cash loan may be accepted within the limits specified U/Sec 269.

Suresh Thiyagarajan (Student) (3986 Points)
Replied 13 October 2019

1. A partner can introduce capital in his firm provided the same is not hit by sec 269ST.
2. According to sec 269ST if a firm receives cash from its partner in a single day of the amount in excess of Rs. 2 lakhs then this provision will be applicable and the same will be liable to a penalty. The penalty will be equal to the amount of contravention.
3. However, cash can be introduced as capital in part on various dates to avoid sec 269ST rather than introducing it at a single stretch.
Please correct me if the above solution has an alternative view.

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Kapadia Pravin (17264 Points)
Replied 16 October 2019

You can bring in cash in 7-8 instalments on different dates but in aggregate limits under 269SS / 269ST you may be hit.

The better way is to deposit cash into your bank savings account and from there transfer by way of cheque or digital mode to partnership Firm's bank account. Choose this way .