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payment exceeding rs.20,000

This query is : Resolved 
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(Querist)
16 May 2008 CASE
one company doing transpot business on contract basis, When they got contract for sending goods it make sub-contract against contract for sending goods to destiy with lorry owner and for which it become mentetory for him to make payment in Cash to driver for petrol and fro other expenses and after wards they have no contact with party and further he got lorry which is available at the time of sending the goods which is chipest.

Here many time the payment made to driver exceed 20000

whether it is disallowe U/S 40A(3)?
Whether it cover under exception under rule 6DD as tradition of the business?
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R.V.RAO

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R.V.RAO (Expert)
16 May 2008 YES.RULE 6DD COVERS TRANSPORT PAYMENTS, DUE TO THE NATURE OF BUSINESS OF TRANSPORT WHERE WE CANNOT EXPECT ALL TRUCK DRIVERS TO HAVE BANK ACCTS AND ATM CARDS .
R.V.RAO
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