Trade agreement

5 years ago

Hi , i am jay from rajasthan and i am starting a new trade firm. I supply agro products to my clients. Client is ready to pay 20% advance against LR copy and pdc cheque/blank cheque for remaining 80% and he is ready to do agreement with signature. For this above term. Is there any problem arise if i do business in this way? Because i am concerning my remaining payment to be secure

2nd- my another client is giving pdc check of total amount aginst LR copy while purchase order and when i will diliver goods they will take cheque bavk and will pay by RTGS , agreement will be done both us , is there any problem if i do business like this way?
Please let me know , by these two way my payment is secure from buyers?
Thank you

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Deepak Yashwantrao Bade

Responded 4 years ago

A.dear client in your case In the first instance, you are inquiring about the problem that may arise in the way you are doing business. In Legal sense you wil not be having any problem till the time you keep the records properly.Secondly, again the query is for business conduct. The conduct of business is kept up to the owner and they shall not be charged till they have proper documents and have maintained the records and pay tax accordingly.

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Kishan Dutt Kalaskar

Responded 5 years ago

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A.Dear Sir,
In these days we cannot believe any body. Moreover the cheque validity period is reduced to 2 months.If they are not honest you have to lose 80 percent. Let it be raised to 50 percent. Both are legal but one cannot believe the recent trend of changing of financial schemes by the government.

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Ambrose Leo

Responded 5 years ago

A.You have two issues regarding accounting and monthly GST returns / Income Tax returns advance tax and annual returns.The solvency & integrity of your client and recoveries of balance payments and complicated legal recourse for realization of outstanding.

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Anonymous

Replied 5 years ago

My client is ready to show firm's turnover and audit report before starting business with them. And they are giving cheques just for security which they will take before unloading goods and will pay by RTGS (remaining amount) . I am taking PO and making agreement of whole deal. Please can you let me know in easy language? And is it still in risky?
Thanks

Ambrose Leo

Replied 5 years ago

First issue is accounting your monthly sales returns for GST payment there should not be any unaccounted sales in fag end of the month & Your annual return should tally with the sales & GST. PO & Agreement part is to protect your interest & legal requirement.risk is part of business cannot predict only time will tell.

Prabhakara S K Shetty

Responded 5 years ago

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A.As per IT and sales tax, etc., keep proper bills and signature of customer in order form, and counter sign in bills. You must know that more than legal issue, solvency of customer is more important in business.

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Anonymous

Replied 5 years ago

Thanks for reply , counter sign in bills? You mean when sending a invoice to my client, i should take a copy back with signature? And what can i do to know solvency of my client ?
Thank you for your valuble help.

Prabhakara S K Shetty

Replied 5 years ago

Solvency can be found out by checking how old is that customer`s business ? Whether they are business community or new to business line, visit their business premises or give that job to an agency, talk to their other customers/ their Bank/s. ( This is not a strict legal advice, but this is what I saw some some of my clients doing.

Anonymous

Replied 5 years ago

Thank you very much sir, this is i am going to do . I am going check their creditworthness and their annual reports/audit reports with tax and GST returns for confirmation their solid existance.
Thanks again for your valuble time.

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