Sec 40a(3)

This query is : Resolved

Querist : Anonymous

Querist : Anonymous (Querist)

06 February 2015 If advance of rs.40,000/- has been paid on 10.04.14 in cash for expenses to be incurred in future,does it attract disallowance u/s 40A(3)?any implication of sec 269ss since it is an advance?

Also,if amount in excess of 20K has been paid to Mr.A against a single bill for different expenditures each does not exceeding 20K, does it attract disallowance u/s 40A(3)?

Also,if amount in excess of 20K has been paid to Mr.A against seperate bills each does not exceeding 20K but for the same expenditure, does it attract disallowance u/s 40A(3)?

Vinayak

Vinayak (Expert)
Follow

06 February 2015 1.Disallowance u/s 40A(3):
This expense will attract 40A(3) and will be disallowed
2. It will not attract 269SS as this section is applicable to acceptance of loans or deposits and in this case you have paid advance for expense.
3. Amount paid to Mr A in excess of Rs 20000 will be disallowed if paid in one day.
4. If amount is paid in cash in one in excess of Rs 20000, even if it is against several bills, it will be disallowed.

Querist : Anonymous

Querist : Anonymous (Querist)

06 February 2015 Thank you..!

You need to be the querist or approved CAclub expert to take part in this query .
Click here to login now

Summarize this with AI

ChatGPT Perplexity Claude Google AI Grok