Sec 40(a)(3),269ss and sec 269t

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Ravi Hissaria (Querist)

21 May 2012 Dear Sir

I am confused regarding the sec of 40(A)(3)according to this sec if any payment is made in cash 20000 or more then it will be disallowed.Now here I am presenting some questions for my solutions which are as under:-
1. We paid 14000 for brokerage and 7000 for commission total payment of 21000 rs to a single party Ram in a single day in cash is here it disallowed or not.

2. We paid 7000 rs each worker for salary in a single day in cash to our 8 workers it means 8*7000=56000 cash payment for same kind of expenses to different parties is here it disallowed or not.

Sir I also request to briefly explain the sec 269ss and 269T of the income tax act.

Please reply the soon I am awaiting.

Thanks in advance.

CA CKP

CA CKP (Expert)

21 May 2012 sec 269ss and 269T are applicable in case of loans only.
u have paid in cash in relation to the expenditure incurred.

1. u have paid cash of rs 21k to a single party for brokerage and commission.

brokerage and comm seems like the same thing, so if it is thing than it will be disallowed.

2. cash payment to workers 7k to each is allowed as the payment to any single party is less than 20k.

Ravi Hissaria

Ravi Hissaria (Querist)

21 May 2012 Dear Sir It means in the second query it will be allowed but in case of first question it will be allowed but what will happen when the payment is made for two different kind ofexpenses to a single party like for the payment of salary and for a brokerage.

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