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Notice from IT department for cash transaction 2016

Biyawerwala Hozefa I. (student) (66 Points)

09 February 2017

my one client is carring a business of Retail Kirana Shop. He was deposited cash in bank account in demonetization period out of cash on hand on 9-11-2016. That cash reliased from nature of daily cash sales and on 9-11-16, he was deposited that amount of cash in bank.

so he get noticed from IT Department, and now i have a question, which column to apply for that.

B.1 Cash out of earlier income or Savings

B.6 Cash received from Un-Identifiable persons (Under option nature of transaction - CASH SALES)

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10 Replies

Bablu Kumar Jha (Accounts Manager) (266 Points)
Replied 09 February 2017

Hi,

I think you should reply with B.6, because cash in hand as on 9th Nov, you have accumulated cash from cash sales less cash exp = "In Hand" and that had been deposited into bank.

But be remember your total cash in hand should be deposited in one time not again and again, 8th Nov onward you can transact with valid cash only.

With Regards,

Bablu Kumar Jha

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manoj (student) (5205 Points)
Replied 09 February 2017

If it is one time den you can say from cash sales

If multiple times den saying cash from saving is the option nothing else

Rahul (Nil) (26 Points)
Replied 09 February 2017

What should I write in the remarks coloumn of every cash sale?

Sandeep (ASST.MANAGER ACCOUNTS) (1751 Points)
Replied 09 February 2017

u have to show B.1Cash out of earlier income or Savings. soon Govt. declare legal tender of Rs.500/- & Rs.1000/-not valid you can not show it either sale orCash received from Un-Identifiable persons

Biyawerwala Hozefa I. (student) (66 Points)
Replied 09 February 2017

MR. SANDEEP

it was not a income or savings, that was cash receipt, which was accumalated by daily cash sales before 9-11-2016.

that was cash on hand on 9-11-16.

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K.chandrasekaran (Partner) (210 Points)
Replied 10 February 2017

accumulated cash sales as on a date held in the form of demonitised currencies and other currencies

Sandeep (ASST.MANAGER ACCOUNTS) (1751 Points)
Replied 14 February 2017

How can u say cash sale before 09.11.2016.? If it is Cash sale, it must be in ur cash in hand a/c. u can not take any banned currency just on or after 09.11.2016 (since Mid night). In my openion it is not cash recd from un-identify person. it is only ur earlier sale receipts which was suppose to deposit before but ur client had not done.

Biyawerwala Hozefa I. (student) (66 Points)
Replied 14 February 2017

YA, OFCOURSE IT WAS CASH ON HAND ON 9-11-16. BUT AS PER INCOME TAX GUIDELINE THAT COLOUNM OF "CASH OUT OF EARLIER SAVINGS OR INCOME" FOR 31-3-16 CLOSING CASH ON HAND, WHEN AFTER IF YOUR BUSINESS HAS BEEN CLOSED AND CLOSING CASH ON HAND ON 31-3-16 WAS NOT DEPOSITED IN BANK A/C TILL THE DATE 8-11-16, SO THAT U CAN SAY IT IS "CASH OUT OF EARLIER SAVINGS OR INCOME."

CHECK OUT THIS LINK (SEE Q.16)

https://incometaxindiaefiling.gov.in/eFiling/Portal/StaticPDF/CashTransactions2016-FAQs.pdf

K.chandrasekaran (Partner) (210 Points)
Replied 14 February 2017

yes it should be cash held out of earlier sales in the form of demonitised currencies.In some notics all deposits are included in the information supplied

Harshit Kabra (INVESTOR) (Student CA final) (1113 Points)
Replied 15 February 2017

That be said as Cash received from EARLIER SALE RECEIPT, which you got from unidentifible person(person not having pan) which u has to deposit that demonitized currency on or before 31/12/2016.