urgent sec-40A (3)

This query is : Resolved

Mayank (Querist)
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28 September 2010 Hiiiiiiii Friends

If a car is purchased with temprarory registration and after one month its registeration is made in cash which is more then Rs. 20000/-& there is no receipt for the same. Than it will be allowed & can be added in the value of the car?

kindly reply me soon .

CA.ViVeK M ACA

CA.ViVeK M ACA (Expert)
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28 September 2010 The provision of section 40 A(3) shall not apply in respect of expenditure for which no deduction is claimed.
Example capital expenditure.

Mayank

Mayank (Querist)
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29 September 2010 Thank you sir.

sir i have some problem in doing prepration for my CA PCE examination,Actually whatever i m reading,i feel that everything is washed up & i have concentration problem also.
can u help me.pls provide me ur email id,if u can.

thanks

Aashok Kumar Sharma

Aashok Kumar Sharma (Expert)
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02 August 2025 Regarding your urgent query on Section 40A(3):
Section 40A(3) disallows expenditure paid in cash above Rs. 20,000 to a single person on a single day if the payment is not by cheque or bank transfer.
However, this restriction does NOT apply to capital expenditure like purchase of a car.
So, if you paid cash above Rs. 20,000 for registration (capital expenditure), even without a receipt, this should not be disallowed under 40A(3).
But practically, lack of receipt may create documentary issues, so try to get some proof or official record of payment.

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