16 September 2020
Dear members, If a person receives salary of RS. 25000/- per month in cash from an assessee who is not covered under sec 44AB audit. Will Section 40A(3) get attracted???will the assessee or employee be penalised under any other sections of the Income Tax Act???
17 September 2020
S. 40A(3) and 40A(3A0 are applicable to every person including charitable organisations. If any payment is made in cash in excess of Rs.10,000 to a person in a day is made then it is to be disallowed (Rs. 35,000 for transportation) except where the return is filed u/s 454AD, 44ADA or 44AE.
The employee is not in trouble even if he received Rs.25,000 in cash every month as his salary.
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