Cash directly deposited into bank account by debtors-40A(3) applicable or not

[Amit Kumar]

Sir, various debtors have directly deposited cash in my current account from different location. what is the impact on me as a creditors and impact and violation on debtors.

AI Summary

Debtors risk violating tax laws with cash deposits over 10,000 daily or 2 lakh in one go. A creditor inquired about the implications of debtors depositing cash directly into their bank account. One expert opined that there is no impact on the creditor, but debtors could violate Section 40A(3) of the Income Tax Act if cash deposits exceed 10,000 in a day. Another expert agreed, adding that if deposits exceed 2 lakh in one instance, it may require compliance with Section 269SS and filing Form No. 61A under Section 285BA of the Income Tax Act, 1961.