Expenditure in excess of cash 20000

Save Share

This query is : Resolved

Manasa sai (Querist)

24 June 2015 plz any one clarify me about the following matters : 1. Can more than 20000 in cash can be paid to creditor ?? whether this is allowed / disallowed ? 2. if any advance given suppose 200000 by real state business to purchsase any land ? ( the cost for acquiring the land is generally expenditure ) 3. any advance given to employee for incurring expenditure relating to business 500000 given. I want to know in above situations whether the expenditure is allowed / disallowed excess 20000 cash payment as per income tax act .

Ankur Singhal

Ankur Singhal (Expert)

25 June 2015 1. no it is disallowed. as amount exceeds rs 20000/-.

2. For real estate business land is Stock in trade or purchses the expense can not be paid in cash exceeding Rs.20000/- Hence disallowed.

3. Petty cash given to employee,
Here u have to check whether he make any cash [payment exceeding Rs. 20000/- in a day to the same person.
If yes the Disallowed.

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now