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Application of Sec 40 A(3)

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01 September 2008 Cash expenses exceeding Rs.20,000 are disaalowed.
But if a party gives the some amount as advance to another person by maintaining an account, say Adavance to Gopal, and if authorises that person for such expenses what is the applicability of the Section.
Act says only about expenses...
whether such advances are covered under this act.

02 September 2008 Advance is not an expenses, hence there is no question of allowance or disallowance.

02 September 2008 if to whom advance is given ,incurs exp more than 20000 in cash then the same is disallwed.




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