29 March 2015
Dear Sir,
We have purchased a 'Old Tata 407 vehicle & made the cash payment Rs. 5,00,000/- for which there is no bill any documentation rather Driving Licence. My question is 1) Will the cash payment for the asset be allowable as per sec 40 (A) 3 of income tax? 2) And the capital asset can be capitalised?
Regards,
AK
29 March 2015
Asset purchase and paid in cash cannot be disallowed u/s 40A(3) as it is not claimed as a deduction. Further, depreciation on such assets can also not be disallowed u/s 40A(3) as it is not in the nature of expenditure also
CAclubindia
