40 a (3) cash payment

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bipinchandra (Querist)
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25 February 2016 dear experts

i would like to draw your attention to a point . as per it sec 40a (3) cash payment exceed to a single person in a day is disallowed . but if for payment exceed 20000/- cash deposited in a bank account in such person to whom we have to pay such amount
i hope i will received correct reply ..!!

thank's
bipin thakor

CA Vap Patel

CA Vap Patel (Expert)
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27 February 2016 Ultimately you will pass journal entry in your book as Party A/c Dr to Cash A/c Cr only.

Secondly section is very clear that payment should not be made other than account payee cheque.

Third Rule 6DD which list down exception doesn't provide any exception for such direct deposit of cash.

Fourth don't forget section 269SS and 269TT, which prohibits you from making such transaction.

Regards .

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