Sasidhar Aruljothi (C.A FINAL) (187 Points)
05 May 2011Guys,
A SHOWROOM PURCHASES CERTAIN ITEMS FOR TRADE FROM A TRADER FOE AN AMOUNT OF 45000. RS.30,000 IS PAID IN CSH IN A SINGLE DAY. THIS IS SHOWN AS STOCK IN THE BALANCE SHEET. NOW DOES SEC40A3 APPLY FOR THIS?
CAN A CASE LAW OR SECTION REFERENCE BE GIVEN BY ANY OF YOU FOR THE APPLICABILITY OR NON-APPLICABILITY SO THAT I CAN QUOTE IT IN SUPPORT OF THIS STATEMENT.
Amol Gopal Kabra (CA,CS,DISA)
(Practicing CA)
(8539 Points)
Replied 05 May 2011
There is not need for any case law. It is a purchase and the payment is in excess of Rs. 20000 in a single day. So, section 40A3 is straight away applicable to this.
herald
(CA)
(32 Points)
Replied 05 May 2011
Sasidhar Aruljothi
(C.A FINAL)
(187 Points)
Replied 05 May 2011
Dear Mr. Amol and Herald sir,
The product is a bronze statue, bought for sale. The showroom officials say that since it is a capital expenditure 40A3 is not applicable........
Only from purchase from certain specified persons are exempted under 6dd. This particular supplier does not come under that specified persons list.
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