Go Ad-Free on CAclubindia with Daily Mobile Updates. Subscribe Now!

URGENT ON PERSONAL EXP.

Navita (profession) (96 Points)

22 November 2007

if payment is made to specified persons then such pay is disallowed under sec 40A(2)

so if payment is being made to directors for personal expenses then any condition under articles that directors will be allowed for reimbursemnts will prevail that condition?

Reply
Follow
Share

2 Replies

Narendra (Employment) (154 Points)
Replied 22 November 2007

Hi NAVITA As per Sec 40A(2),,, Payments made to specified persons TO THE EXTENT UNREASONABLE only disallowed... not the entire amount,,,,,,,,, In the case of a PVT COMP ,If the Articles of Associations provides , a company can reimburse the personal expenses of a director...such reimbursement is not disallowed if it as per AOA.