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Cash payment

nayan (article assistant) (466 Points)

21 December 2012

can cash payment of 20000 can be made for a party??

what if cash payment is made below 20000 per day but paid 35000 in 3 days for one product purchased??

can cash payment of 19000 be made to same party twice a day for two bills?

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15 Replies

NARENDRA (ACCOUNTS MANAGER) (1994 Points)
Replied 21 December 2012

yes u can pay two or more bills in a same day.

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nayan (article assistant) (466 Points)
Replied 21 December 2012

i mean more than 20000 in aggregate to the same party for two bills. or the payment to party shall be limited to 20000 in a day irrespective of number of bills?

NARENDRA (ACCOUNTS MANAGER) (1994 Points)
Replied 21 December 2012

1 PARTY TWO BILLS 19000+19000 CAN PAY IN A SAME DAY........

CA Gaurav Ajit Potdar (Chartered Accountant) (846 Points)
Replied 21 December 2012

According to sec 40A(3) Any Expenditure for which payment or aggregate of payment made in a day to a person in excess of Rs 20000/- in cash the whole of such amount will be disallowed,so it will be restricted to payment of Rs20000/- in a day to a person.irrespective of number of bills issued.

S 40A 3 "incurs any expenditure for which payment or aggregate of payment is made to a person in a day is in excess of Rs.20000"in cash the whole of such expenditure will not be allowed as a deduction

Read more at: /forum/sec-40a-3--122467.asp#.UNQZ6KzYTlc

CA Kedar Sakhardande (Proprietor) (942 Points)
Replied 21 December 2012

You need to refer to Rule 6DD as well to find out exemptions for cash payments in excess of Rs. 20K

regards

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Vikash Kumar (Manager Accounts (CA. Final)) (694 Points)
Replied 21 December 2012

Restricted to payment of Rs.20000/- in a day.

Durga Prasad (Trainee) (392 Points)
Replied 21 December 2012

You can not pay/take more than Rs.20000/- to one person on same day in cash.

Rajesh Kandoi (Practice) (39 Points)
Replied 21 December 2012

There is no restriction in taking business receipts (e.g. sale proceeds) more than 20,000/- from one customer, through one bill and even in single transaction.

the restriction of section 40A (3) is on the payer and not on the recepient.

1 Like

deepaksamra (Accountant) (52 Points)
Replied 22 December 2012

Cash Payment to any party per day not to be exceed Rs.20000/- in any case.

CA Sanjay Bag (CHARTERED ACCOUNTANT) (3340 Points)
Replied 22 December 2012

Originally posted by : deepaksamra
	Cash Payment to any party per day not to be exceed Rs.20000/- in any case.

Fully Agreed

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Paresh Dholu (Chartered Accountants) (393 Points)
Replied 22 December 2012

Max.20000 per day per party

Anoopa H P (Member of ICAI CS Executive) (192 Points)
Replied 22 December 2012

Originally posted by : Gaurav A. Potdar
	According to sec 40A(3) Any Expenditure for which payment or aggregate of payment made in a day to a person in excess of Rs 20000/- in cash the whole of such amount will be disallowed,so it will be restricted to payment of Rs20000/- in a day to a person.irrespective of number of bills issued. S 40A 3 "incurs any expenditure for which payment or aggregate of payment is made to a person in a day is in excess of Rs.20000"in cash the whole of such expenditure will not be allowed as a deduction Read more at: /forum/sec-40a-3--122467.asp#.UNQZ6KzYTlc S 40A 3 "incurs any expenditure for which payment or aggregate of payment is made to a person in a day is in excess of Rs.20000"in cash the whole of such expenditure will not be allowed as a deduction Read more at: /forum/sec-40a-3--122467.asp#.UNQZ6KzYTlc

Pratik Shah (Assistant Manager Business Process Specialist Accounting Technician B.Com (Specialization in Accounts & Finance) & Technology Savey) (151 Points)
Replied 24 December 2012

As per Sec 40A(3) Cash payment upto Rs. 20000 per day is allowed irrespective of the bill allowed.