Limit on cash on hand

Querist : Anonymous (Querist) 15 January 2020 This query is : Resolved
Sir,
One I.t. individual person and one I.t. business person maximum cash on hand limit show in balance sheet at the end of the finicial year under income tax act

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Raj Kumar Makkad (Expert) 15 January 2020
There is no such limit rather cash transaction of more than Rs. 20,000/- cannot take place legally.

Sb Karma (Expert) 16 January 2020
You just need to show valid source of the cash.....
no limit set for balance sheet.

krishna mohan (Expert) 16 January 2020
It depends on the business and working capital needs. But report cash as per your customs and balance can be deposited in Bank and show as Cast at Bank.

kavksatyanarayana (Expert) 16 January 2020
Consult a local CA for better guidance or put this query in CAclubindia.com

Dr J C Vashista (Expert) 17 January 2020
Consult a local prudent chartered accountant for better appreciation of facts/documents, professional advise and proceeding.

T. Kalaiselvan, Advocate (Expert) 25 January 2020
“As of now, there is no prescribed limit on cash holding but transactions above Rs 2 lakh in cash has been banned. In addition to this limit, the Income Tax Act prohibits acceptance or payment of an advance of Rs 20,000 or more in cash for purchase of immovable property
The only problem is to explain how it got there (source of income). If you have a valid explanation (that is acceptable to IT dept.) you need not worry.

Rajendra K Goyal (Expert) 26 April 2020
There is no limit fixed under IT Act.

If extraordinary high case is shown on closing day / many fold than average cash balance during the days of year, taxation authorities may seek clarification.

Raj Kumar Makkad (Expert) 26 April 2020
Donor is liable to show the source of such gift to IT department even though there is no such limit.

Rajendra K Goyal (Expert) 27 April 2020
Practically, some of the business houses / business person have much more / very low cash than normal at the time of closing. Again repeated that the cash should not be very very high and have proper explaination of the source.

Guest (Expert) 27 April 2020
Rightly Said by Expert Mr.Kavksathyanarayana . Right Personnel to be approached to get the Right Feed back.

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