Payment in cash above Rs. 20,000/-

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Yajuvendra Rawat (Querist)
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03 May 2010 Dear Sirs & friends,

Our company has paid Rs.64,750/- in cash to a marketing executive. We had given him an advance of Rs. 50,000/- for expenses. When he returned he showed up expenses of Rs. 64,750/-. We have accounted all the expenses in Local Travelling and made cash voucher. Is this practice feasible , Will this attract section 40A (Payment in cash above Rs. 20,000/-) Please give your valuable suggestion.

CA Suresh Kumar Agarwal

CA Suresh Kumar Agarwal (Expert)
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03 May 2010 If he had not made any consolidate payment more than 20000/- then it is ok. If he had made payments in various head and on different date then it is also ok.

CMA Ramesh Krishnan

CMA Ramesh Krishnan (Expert)
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03 May 2010 up to single expenses is not crossing Rs.20000/ is ok

CA krishna Kamthe

CA krishna Kamthe (Expert)
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04 May 2010 single payment against one bill less than 20000 in cash in day is allowed eg bill no 1 amount Rs 30000 if on 5 dec make payment of 15000 in cash and on 6 dec make payment of 15000 then it allowed.
or 2 bills each amount 19000 each if make payment in cash 19000 each even though from one party it allowed.

CS Jithesh (ACS,)

CS Jithesh (ACS,) (Expert)
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04 May 2010 The Cash transaction in aggregate should not exceed Rs 20000, otherwise payment via cheque or DD should be done.

CMA Arif Farooqui

CMA Arif Farooqui (Expert)
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05 May 2010 agree with experts

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