20 February 2008
if you are purchase machinery in cash it is allowed. only when your expences are in excess of rs.20000/-in cash that will not allowed u/s 40(A)(3) expences which are debited to p&l a/c are under 40(A)(3)
20 February 2008
THE ASSETS PURCHASED IN CASH ARE ALLOWED EVEN IF CASH PAYMENT EXCEEDS RS. 20000/- BECAUSE IT IS NOT A EXPENSE BUT CAPITAL EXPENDITURE BUT EXPENSES WHICH ARE DEBITED TO PROFIT AND LOSS ACCOUNT ARE COVERED UNDER 40(A)(3).BUT DEPRICIATION IS ALLOWED BECAUSE THE EXPENDITURE WAS MADE ON CAPITAL EXPENDITURE
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