Cash payment more than rs.20,000

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UMESH KUMAR TRIPATHI (STUDENT CA- FINAL) (74 Points)
Replied 16 June 2012

read Section 40 A(3) care fully, which says that EXPENDITURE incurred which is more than Rs.20000/- the payment in  respect of the same is not allowed in cash or bearer cheque but allowed through cheque, demand draft or any other electronik mode such as internet banking. read with exception of the section RULE 6DD.

The one very most important thing is that if there two  expenditure incurrd and both  are less than or Rs. 20000/- from the same person than you can make cash payment to the person more than Rs.20000/- in cash in same day and expenditure is allowed.

SECTION CONCETRATE ON EXPENDITURE AMOUNT


srinivas reddy (article student) (328 Points)
Replied 16 June 2012

yes absoulutly correct


SHIVPRASAD SUBUDHI (ARTICLE) (225 Points)
Replied 16 June 2012

yes it is correct that cash payment more than of Rs.20,000 not allowed to one person one day for expenses


KUNAL KOCHAR (CA FINAL) (27 Points)
Replied 16 June 2012

is this limit just for expenses or also applicable for payment to creditors?

 


Arun Kumar Das (Advocate) (21 Points)
Replied 16 June 2012

Any expenditure in respect of which payment or aggregate of payments made to a person in a day exceeds Rs.20,000/- in cash  or bearer cheque ( exceed Rs. 35000/- for plying , hiring or leasing goods carriage ) is disallowed u/s 40A(3) but there are some exception under some crcumstances which specified in Rule 6DD.



kiran g panchal (accountant) (34 Points)
Replied 17 June 2012

please write more example of payment exceeding rs 20000....from kiran g panchal


Pradeep Kumar Das (M.Com(Fin)and IPCC continue )   (37 Points)
Replied 18 June 2012

U/s 40 A(3)  Cash paid not exceed of amounting Rs.20000/-in a day to a one party .If made in books of a/c penalty U/s 271(1)C   (3 times penalty in Net Profit )


Vijay Kumar (Excise & Taxation) (23 Points)
Replied 20 June 2012

it is allowed for purchase of old machinery


Priyanshi Shah (student) (25 Points)
Replied 24 June 2012

If an cash payment is made to bank for franking , is it allowable expense???


Priyanshi Shah (student) (25 Points)
Replied 24 June 2012

If an cash payment is made to bank for franking , is it allowable expense??? the cash payment is made of RS 31500.

 



Pradeep Kumar Das (M.Com(Fin)and IPCC continue )   (37 Points)
Replied 24 June 2012

Cash payment to Bank   for franking  . This expeness is not allowable  because  as per sec.40 A(3) cash paid not exceed amount of Rs.20000 /- it is allowable for Demand  Draft  ..frown



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