Section 40a(3)

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Querist : Anonymous

Querist : Anonymous (Querist)

19 June 2015 According to act, Payment above Rs.20000 to a single person in a day shall be disallowed under income tax.
if i want to made a payment of rs. 25000
to a person, can i issue 2 different bills of rs.19000 and rs.6000
section 40A(3) shall be allowed or not on above point. plssssss clarify

CA Himanshu Ojha

CA Himanshu Ojha (Expert)
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19 June 2015 Aggregate Payment has to be seen: Even if a person makes more than one different purchases for cash from same person in excess of Rs. 20000 in a single day even though on separate cash memos, such aggregate payment will be disallowed u/s 40A(3).

In your case the transaction will be covered by section 40A(3) and such expenditure will be disallowed.

Message likes : 3 times

Ankur Singhal

Ankur Singhal (Expert)
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20 June 2015 agree with himanshu
pay amount in 2days

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