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Applicability of Sec.40(A)3

CA SUBBIAH K (SENIOR MANAGER - F&A) (105 Points)

03 May 2009

Dear friends.. pls clarify...

Whether Sec. 40 (A) 3 will applicable to advance for the expenses (traveling expenses) if the payment exceeds Rs.20,000/- other than by way of A/c payee cheque or draft...?

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4 Replies

Ca Anand Dubey (Chartered Accountant) (1676 Points)
Replied 03 May 2009

read the section , you wil find the answer

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Late CA Sampat Jain (Chartered Accountant) (4772 Points)
Replied 03 May 2009

This rule is applicable even in respect of the a advance for an expenditure covered u/s 30 to 37.

PiyushAgrawal (Chartered acooutant in practice) (575 Points)
Replied 04 May 2009

Originally posted by :SUBBIAH K
"	Dear friends.. pls clarify... Whether Sec. 40 (A) 3 will applicable to advance for the expenses (traveling expenses) if the payment exceeds Rs.20,000/- other than by way of A/c payee cheque or draft...?	"

ya it would applicable in this case also.

Piyush Jain (CA) (283 Points)
Replied 04 May 2009

I beg to differ from Sampat and Piyush Aggarwal. The section provide that any EXPENDITURE should not exceed Rs. 20000/- in cash and therefore advance will be not covered ( well settel rule)

Regards

Piyush