Applicability of section 40 (a) (3)
This query is : Resolved
21 August 2012
Interest paid amounting to more than Rs. 20,000/- in cash to bank, financial institution or other NBFC will attract the provision of above mentioned subject...
Regards
Pratik....
Interest paid amounting to more than Rs. 20,000/- in cash to bank, financial institution or other NBFC will attract the provision of above mentioned subject...
Regards
Pratik....
Dintakurthi Tirumala
(Expert)
21 August 2012
Rule 6DD gives the exemption to section 40A(3).
As per rule 6DD(a):- Payment made to banking and other credit institutions, such as Reserve Bank of India,commercial banks in the public or private sectors, co-operative banks or land mortgage banks,primary credit/agricultural credit societies, Life Insurance Corporation of India. Section 40A(3) Not applicable.
So as per the above provision 40A(3) transaction with the banks is not applicable and no disallow but this exemption not available to the Financial Institutions and NBFC.
So transactions with the bank 40A(3) not applicable but transactions with the financial institutions or with the NBFC applicable.
OM SAI SRI SAI JAI JAI SAI
As per rule 6DD(a):- Payment made to banking and other credit institutions, such as Reserve Bank of India,commercial banks in the public or private sectors, co-operative banks or land mortgage banks,primary credit/agricultural credit societies, Life Insurance Corporation of India. Section 40A(3) Not applicable.
So as per the above provision 40A(3) transaction with the banks is not applicable and no disallow but this exemption not available to the Financial Institutions and NBFC.
So transactions with the bank 40A(3) not applicable but transactions with the financial institutions or with the NBFC applicable.
OM SAI SRI SAI JAI JAI SAI
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