My friend has purchased goods for poultry consumption of Rs. 30,00,000 in 15 bills ( i.e 200000 per time*15 times ) all payment is made by cash. the supplier has given receipt of Rs. 19500 per day for entire payment of Rs. 30,00,000 kindly let me know his position if his books selected for scrutiny
21 March 2011
Single payment which exceeds Rs 20,000/- or payment which exceeds Rs 20,000/- to single person in the same day will get disallowance 40 A (3)..+
21 March 2011
its will disallowed.but suppliers is bifercate that amt. to safe from sec. 40A(3) but its a risky task you need to pay cash below 20,000 in single day or pay by cheque,dd/neft & rtgs. their are many facilities which help your friends to pay in a one day.
CAclubindia
