3) Repayment of loan is not debited to P/L. How the question arises as to allowability.
Guest
Guest
(Expert)
14 May 2013
For payment made in point 1 & point 2,
Section 40A(3) is applicable, however other sections of IT Act also applicable, but you have asked for 40A(3) specifically.
Section 40A(3): Where payment or aggregate of payment made to a single person on a single day is made other than by account payee cheque or account payee demand draft is made on a single day and exceeds rs 20000, then such expenditure is disallowed under the act.
hence if payment is made to the single debtor or single creditor or to steel company, on a single day then such amount is disallowed otherwise not.
For point 3, Expert Sourabh Aggarwal gives correct reply
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