Cash transction

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Anirudha (Querist)
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11 September 2017 Hi,

As per section Section 40A(3) Limit to reduce the existing threshold of cash payment to a person from twenty thousand rupees to ten thousand rupees in a single day; i.e any payment in cash above ten thousand rupees to a person in a day, shall not be allowed as deduction in computation of Income from “Profits and gains of business or profession“;

Shall it applicable for below matter
In a Healthcare sector a patients cash deposit of Rs 50k towards hi/her treatment but after 2days stay hi/her bill was 28k and hospital is liable to pay refund of Rs 22k and he doesn't have any bank account.

So in the above cases should we pay the refund as cash to the patients ?

Please help me.

Regards
Anirudh

Dibin Divyakumar

Dibin Divyakumar (Expert)
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11 September 2017 The amount 22K you repay is not an expenditure in your P&L, So 40A(3) does not apply, But 269SS & T shall apply as the repayment exceeds 20K.