27 January 2014
No. Single transaction of payment of salary exceeding Rs.20,000 will not be allowed u/s 40A(3). Exception is given in Rule 6DD(i) Where the payment is made by an assessee by way of salary to his employee after deducting the income-tax from salary as per section 192, and when such employee
(i) is temporarily posted for a continuous period of 15 days or more in a place other than his normal place of duty or on a ship; and
(ii) does not maintain any account in any bank at such place or ship.
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