27 June 2010
my client paid 20000 twice in cash as legal expenditure to increase authorized capital from 1.4 to 1.6 crore what will be its treatment in income tax and company act
30 June 2010
Since the expenditure is incurred towards payment to Registrar of Companies, it is a payment to Government and is covered by Rule 6DD read with section 40A(3) of the Incometax Act. If the payment is made on different dates, it is still safe since Sec. 40A(3) speaks about payment exceeding Rs.20000/- on single day to a person.
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