Applicability of 40A(3)
This query is : Resolved
Dharmishta Tank
(Querist)
26 March 2008
URGENT! please clarify! my client has made cash payment for purchase of capital asset exceeding Rs. 20,000/-.Whether the expenditure will be disallowed! or Whether depreciation in that respect will be disallowed!
CA. GOPAL SONIKA
(Expert)
26 March 2008
allowed as section 40A(3) does not cover capital expenditure
26 March 2008
SECTION 40A(3) DISALLOWS ONLY REVENUE EXPENDITURE EXCEEDING RS 20000/- AND NOT CAPITAL EXPENDITURE EXCEEDING RS 20000/-,THEREFORE CAPITAL EXCEEDING RS 20000/- CAN BE PURCHASED IN CASH AND NO DEPRICAITION SHALL BE DISALLOWED
CA Praveen Chopra
(Expert)
26 March 2008
Section 40A(3) speaks in respect of expenditure only.since you have purchased a capital asset which is not an expenditure so there is no question of disallowance u/s 40A(3)regarding amount of capital assets purchased as well as depreciation thereon.
26 March 2008
Section 40A(3) does not cover capital expenditure. So, even if u pay amount exceeding Rs 20000/- in cash, not to worry.
You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now
Click here to login now
Similar Resolved Queries
Unanswered Queries
- Depreciation Chart Companies Act
- GST Audit whether Govt Companies are exempt?
- PTRC Show Cause Notice on Email
- Accounting treatment of AMC alongwith the purchase of Laptop
- Unable to File TDS Q2 Return – New TRACES Portal Error
- Issuing of delivery challan by seller of goods
- EPF ECR NEW RULES Sep 17th 2026
- Transfer of Physical Stock Between Two Proprietorship Concerns
- MSME disclosure and disallowance
- Taxation of crypto futures in India Fy 2026- 2027
- GST Treatment of Purchases with GST Paid where Outward Supplies of Manufactured CattleFeed Exempt
- Expert Help Required for TDS Refund 100000 Through TRACES – AY 2022–23
- IMPORT PURCHASE ENTRY PASSED IN BOOKS OF ACCOUNT
- FAST DS 26 Undisclosed Foreign Asset Disclosure Scheme 2026
- Regime change
- Goods sold but invoice not issued
- Tally: Imported bank entries do not show up in manual reconciliation
- Sales of goods of amount Rs97 lakhs to a party
- Confused About My Career After 12th — Cyber Security, AI or Finance? Need Guidance
- FAST-DS 2026 Under Tax Law - No recourse or support for person declaring via this scheme?
Trending Online Classes
-
DT & Audit (Exam Oriented Fastrack Batch) - For May 26 Exams and onwards Full English
CA Bhanwar Borana & CA Shubham Keswani
Subscribe to Pro
Join an elite circle of professionals
CAclubindia
