19 June 2015
According to act, Payment above Rs.20000 to a single person in a day shall be disallowed under income tax. if i want to made a payment of rs. 25000 to a person, can i issue 2 different bills of rs.19000 and rs.6000 section 40A(3) shall be allowed or not on above point. plssssss clarify
19 June 2015
Aggregate Payment has to be seen: Even if a person makes more than one different purchases for cash from same person in excess of Rs. 20000 in a single day even though on separate cash memos, such aggregate payment will be disallowed u/s 40A(3).
In your case the transaction will be covered by section 40A(3) and such expenditure will be disallowed.