Real estate cash transactions, Accounting - Auditing

[NRI owner]

I purchased a property 3yrs back with 100% white money.

But the seller insisted on paying in cash. I ended up paying in cash in 2Crs. and closed the bank account as i moved from that area.

Now income tax dept is asking for old bank transactions. Will I be in trouble if income tax dept finds out that i paid in cash? if so, what kind of trouble would it be? Will they have authority to fine me because i withdrew white cash?

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[MARIAPPAN GOVINDARAJAN]

If you are in business and you add this amount as an expenditure, then such expenditure will be disallowed as the payment exceeding ₹ 20,000/- is paid in cash instead of cheque. But withdrawing cash is not bothered. The said amount may be retained with you and you may spend in a phased manner.