I have made purchases on credit. And I made payment through a crossed cheque of rs 50,000.I l came to know that under section 40A(3), the payment above 20,000 is to be made by account payee cheque. But I have croosed the cheque but not written account payee there. Will it be disallowed under this provision despite the fact that the supplier didn't endorse the cheque further? Please help.
11 Replies
Ashwin Kumar
(1234 Points)
Replied 24 October 2017
payment to be made through account payee cheque drawn on a bank or account payee bank draft in order to claim allowance....u ha e not satisfied any of the condition....so my guess is it will be disallowed
amit aggarwal
(Tax Professional)
(80 Points)
Replied 24 October 2017
Disallowed if payee obtained cash through bank counter. Allowed if Payee deposited cheque in his own account. (Also refer to exception laid down in Rule 6DD)
Navin Agarwal
(354 Points)
Replied 24 October 2017
now the limit has been revised and the amt is now 10000
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
Nitesh Chawla
(Nil)
(64 Points)
Replied 24 October 2017
Purchase/Sale of Goods in ordinary course of business does not amount the cash limit of 10000. Only expenses incurred amounting to more than 10000 as mentioned in section 40(A)3 liable to disallowance of expenses and other cases as mentioned in above section.
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