Cash Payment in Excess of Rs. 20000/-
This query is : Resolved
25 October 2008
Good Evening Sir,
As per Section 40(A)3 of Income Tax Act, if Payment is made through CROSSED Cheque(not A/c Payee Cheque) is it treated as allowable expenditure if the payment exceeds Rs. 20000/-
As per Section 40(A)3 of Income Tax Act, if Payment is made through CROSSED Cheque(not A/c Payee Cheque) is it treated as allowable expenditure if the payment exceeds Rs. 20000/-
25 October 2008
As per section 40(A)(3)(a) expenses will be disallowed.
25 October 2008
Kewal,
If The payment is through Crossed Cheque/ A/C Payee Cheque/DD. The Expenses is Allowed.
Hence in your case there is no problem.
Cheque crossed has become A/C Payee Automatic
If The payment is through Crossed Cheque/ A/C Payee Cheque/DD. The Expenses is Allowed.
Hence in your case there is no problem.
Cheque crossed has become A/C Payee Automatic
25 October 2008
section 40(A)(3) has been amended. Now if a payment exceeding 20000/- is allowed under income tax act if it is made through a account paypee cheque only.
25 October 2008
I am agree with Mr. Sachin Kumar, it is amended last year, cross cheque can be endorsed to anybody but cross cheque with language "account payee only" cant be endorsed
25 October 2008
How can one verify whether its crossed or a/c payee at the time of assessment?
26 October 2008
AO may always call for evidence from bank
28 October 2008
I agree with sagar
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