A bill of rs.25,000/- can be paid in cash on several dates?

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Dinesh Singh (Querist)
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08 April 2017 Dear Experts,

Kindly guide, whether a single bill of Rs.25,000/- can be paid in cash on several dates on or after 01.04.17 ?

OR is there any provision alike the payment is received in cash against a single bill of more than Rs. 2,00,000/- shall attract the penalty ?

i.e. is it so that to make a payment under Rs.10,000/- the subject bill should be under Rs.10,000/-?

Kindly help me out on this matter.

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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08 April 2017 Single bill of 25000 can be paid in cash on several days after 01/04/2017.

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Dinesh Singh

Dinesh Singh (Querist)
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08 April 2017 Very much thank you for such a kind response which is remarkable in respect of promptness.

CS Advocate Abhishek Goyal

CS Advocate Abhishek Goyal (Expert)
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08 April 2017 w.e.f. 01.04.2017 the limit for cash payment in respect of an expenditure is reduced to Rs 10000/- instead of Rs 20000/-. The disallowance u/s 40A(3) pertains to not only a single or aggregate payment but also in respect of an 'expenditure' Thus in other words for the purposes of section 40A(3) both the payment and amount of bill i.e. expenditure should not exceed Rs 10000/- even if payment is made on different dates. There is a tribunal ruling to this effect in the case of Raja & Co. v. CIT [2014] 64 SOT 12 (Cochin).

Dinesh Singh

Dinesh Singh (Querist)
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08 April 2017 Dear Experts,

I am confused now that what advice should be followed. In this regard kindly clear following queries:
1. If a single bill is more than Rs.10,000/-, in case shall that be disallowed if is paid in cash?

2. Is there any threshold limit for cash payment to a particular person during the financial year, i.e. if a company pay in cash (every payment is below Rs.10,000/-) to a small vendor or to rickshaw puller for loading & unloading aggregating Rs.30,000/- during the year, in case shall that be disallowed?

3. If a bill of Rs.50,000/- and is paid in cash on several dates below Rs.10,000/-, in case shall that be disallowed ?

Kindly help me out of this matter.

Regards

CA R SEETHARAMAN

CA R SEETHARAMAN (Expert)
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08 April 2017 1 As per tribunal decision here the payment in a day not exceed 10000 hence no disallowance.
2 No thereshold for a year, the amount of 30000 paid to richshaw will be allowed.
3 No disallowance as cash payment in a day not exceed 10000.

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