Expenses above 20000-
This query is : Resolved
06 September 2010
Sir, if I pay more than Rs.20000 to a person for more than one bill, than will my expense be disallowed under I.T Act 1961 or not?
06 September 2010
Sec. 40A(3) restricts the payt. of exp. exceeding Rs. 20,000/- by disallowing 100% , if payt is made by any mode other than a/c payee Cheq or draft.
W.e.f. 01/10/2009, the payt made for plying, hiring or leasing goods carriage , the limit is enhanced to Rs. 35000/-. There are certain exceptions provided under Rule 6DD under which exp. een exceeding Rs. 20,000- 35000/- shall be allowed , even though payment or aggregate of payments made to a person in a day not made by an account payee chq /draft.
Hence, now even if the payt exceeding Rs. 20,000/- is made to the same person even against two or more than two bills, restrictions of Sec. 40A(3) would get attracted.
W.e.f. 01/10/2009, the payt made for plying, hiring or leasing goods carriage , the limit is enhanced to Rs. 35000/-. There are certain exceptions provided under Rule 6DD under which exp. een exceeding Rs. 20,000- 35000/- shall be allowed , even though payment or aggregate of payments made to a person in a day not made by an account payee chq /draft.
Hence, now even if the payt exceeding Rs. 20,000/- is made to the same person even against two or more than two bills, restrictions of Sec. 40A(3) would get attracted.
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