Section 40A(3)
This query is : Resolved
Querist : Anonymous
Querist :
Anonymous
(Querist)
01 June 2011
"A" Purchases goods from "B" . "C" a group Company of "A" makes payment to "B" as per instructions of "A" .
In the Books of account of "A" , the ledger account of "B" is debited and ledger account of "C" is credited.
Whether the same is in violation of Section 40A(3) ? as the payment is not made by "A" through an Account Payee Cheque, but by way of Book entry ( and also the same not covered by the exception provided in Rule 6DD(d)).
In the Books of account of "A" , the ledger account of "B" is debited and ledger account of "C" is credited.
Whether the same is in violation of Section 40A(3) ? as the payment is not made by "A" through an Account Payee Cheque, but by way of Book entry ( and also the same not covered by the exception provided in Rule 6DD(d)).
CA. RAVIKUMAR
(Expert)
01 June 2011
As per my knowledge It should be disallowed under Sec 40A(3) because there is no exemption in Rule 6DD and the company A which claims Expenses for Payment made by Company C
Hence it should be disallowed.
Hence it should be disallowed.
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