Cash Repayment of Entire Outstanding Capital upon Retirement

[Guest]

Dear All,

My query is mentioned below:

Upon retirement, whether outgoing partner be paid his entire outstanding capital in cash? Whether any disallowance under section 40A(3) or under any other provision shall be attracted or not. The amount is ₹ 15,00,000 /-

Please reply with Reference Notification / Circular Case Law.

Thanks

Ravi Karda

AI Summary

Can an Outgoing Partner Receive 15,00,000 Cash Without Tax Disallowance Under Section 40A(3) of the Income Tax Act? An individual inquires whether an outgoing partner can be paid their entire outstanding capital of 15,00,000 in cash upon retirement without attracting disallowance under section 40A(3) or other provisions of the Income Tax Act. The individual seeks guidance on whether such a transaction would be permissible and requests references to relevant notifications, circulars, or case law for clarity.