40a(3)

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

02 December 2014 if i pay to same supplier for two different invoices of same product in cash in a single day. both are amounting to rs. 19000/- each. is it allowed?

and also clear the consequences if i purchase a machinery by paying more then 20000/- in cash.

Thanking You

CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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02 December 2014 If there is two different invoice both below the 20,000 then by making a single payment which exceeds 20,000 then section 40A(3) is not applicable.

Section 40A(3) is not applicable on purchasing capital assets

shivaji prasad bhimavarapu

shivaji prasad bhimavarapu (Expert)
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02 December 2014 For capital assets on which depreciation is claimed, Sec 40 A(3) may apply so it is better to avoid cash payments in excess of Rs.20000/- even for capital assets.

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CA Kumar Mukesh

CA Kumar Mukesh (Expert)
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02 December 2014 Sivaji Sir, can you quote any case to support your reasoning.

shivaji prasad bhimavarapu

shivaji prasad bhimavarapu (Expert)
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03 December 2014 I read the same in the book of Dr Vinod K Singhania.