https://www.taxtmi.com/forum/issue?id=1491 Acceptance of share application money in cash is not per se a violation of the prohibition on cash receipts; the legal effect depends on factual proof of genuineness and source. Documentary and transactional safeguards-such as allotment, issuance of share certificates, and demonstrable source-support treatment as share capital rather than loan or deposit. Cash receipt followed by refund, inadequate explanation, or lack of reasonable cause exposes the receipt to recharacterisation and possible penalty. Advisable practice is to collect by account-payee cheques and preserve evidence to avoid adverse treatment. en-us Sat, 12 Sep 2009 11:05:30 +0530 Thu, 23 Jan 2025 15:58:42 +0530 TaxTMI RSS Generator https://www.taxtmi.com/forum/issue?id=1491 Acceptance of share application money in cash is not per se a violation of the prohibition on cash receipts; the legal effect depends on factual proof of genuineness and source. Documentary and transactional safeguards-such as allotment, issuance of share certificates, and demonstrable source-support treatment as share capital rather than loan or deposit. Cash receipt followed by refund, inadequate explanation, or lack of reasonable cause exposes the receipt to recharacterisation and possible penalty. Advisable practice is to collect by account-payee cheques and preserve evidence to avoid adverse treatment. Discussion-Forum Income Tax Sat, 12 Sep 2009 11:05:30 +0530 https://www.taxtmi.com/forum/issue?id=1491