Cash payment

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SANJAY KUMAR AGARWAL (Querist)
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06 September 2013 Can a private limited company transfer cash exceeding Rs. 20000/- to its branch office located in another state. Did the restriction of cash transaction u/s 40A(3)applicable on transactions between a the H.O of a private limited co. & its branches.

Ajay Mishra

Ajay Mishra (Expert)
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06 September 2013 Hi

Yes, they can transfer more than Rs. 20000/- to its branch office without any aplicability of provision of Section 40A(3).

You are not paying for allowances or expenduture, it is a transfer for operation of company so it is not deductible.