section 40A(3)


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Querist : Anonymous

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Querist : Anonymous (Querist)
07 September 2010 purchase bill of material Rs.75260/- dated 15.5.2009.

payment made in cash as follows

date : 20.5.2009 rs.18000/-
date : 15.06.2009 rs.17500/-
date : 17.6.2009 rs.17500/-
date : 27.6.2009 rs.15500/-
date : 30.6.2009 rs.6760/-

now query is whether it is disallowable u/s. 40A(3).

pl give expert opinion to solve our query

07 September 2010 Sec. 40A(3) provides that where an assessee incurs any expenditure in respect of which a payment or aggregate of payments made to a person in a day, otherwise than by an a/c payee chq or a/c payee draft, excees Rs. 20,000/- no deduction shall be allowed in respect of such exp. As in your case the payment does not exceed the ceiling of Rs. 20,000/- in a day, the section is not attracted eventhough the agreegate payt against the single invoice exceeds Rs. 20,000/-.

07 September 2010 Sec,40A(3) not attracted in your transactions


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