16 September 2008
We are a contractor and take the delivery of diesel pump. Some time diesel pump owner ask us to give payment in favour of his creditor i.e. Indian oil from which he takes diesel. Is correct to make the payment of third party on behalf of our creditor under which rule of Income tax.
16 September 2008
Section 40A(3) restricts the payment of expenditure in excess of Rs 20000/-, but it is not mandatory that the cheque/dd should only be drawn in favour of person from whom the goods or services have been purchased.
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