Cash payment exceeding rs.20000

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manik (Querist)

05 November 2011 whether cash payment made for purchase of fixed assets allowable or not.as i have read two different views of two renouned authors on this
as per girish ahuja sir's book - cash paid exceeding rs.20000 for purchase of capital assets is not disallowed under sec 40a(3)

as per singhania sir's book , it is written that cash paid for purchase of depriciable assets is disallowed u/s 40a(3)to the extent depriciation is claimed on such portion

please clarify the situation with decided case laws
whether exp on following exceeding rs.20000 be allowed or not
1.land rs.500000
2.car down payment rs.125000
3.machinery purchased rs.550000

CA Hardik Bunha

CA Hardik Bunha (Expert)

05 November 2011 My friend,
section 40a(3) refers only revenue metter but not capital.
it is not disallowed......
land 500000 NO
Car 125000 NO
Machinery 550000 NO

manik

manik (Querist)

05 November 2011 dear sir, it is written in the act the word "expenditure" not revenue not capital, then how can u say that it is for revenue exp.

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