Expenditure exceeds in cash rs.20000

TDS 1575 views 21 replies

Rent paid Rs. 38,000 p.m. in cash after deducting TDS is disallowed under section 40A(3) ?

Fixed asset (computer) of Rs.45000/- is acquried by paying cash  is disallowed under section 40A(3) ?

Replies (21)

rent is disallowed, not assets. As assets is not expensed off.

Agree with vineet

Sir ,

What about depreciation ? Is such an asset is eligible for deduction u/s 32.

Yes, computer is eligable to depreciate u/s 32..

 

aadi~U R QUOTING WRONG SECTION AGAIN~

yup he has quoted depreciation under business or profession  he is wrong

 

Cash payments in excess of Rs. 20,000 towards any type of revenue expenditure is disallowed. In that case payment can be made through account payee cheque. However, purchase of fixed assets amounts to capital expenditure & hence not disallowed. Depreciation can be claimed.

PURCHASE OF FIXED ASSETS IS A CAPITAL EXPENDITURE....

SEC 40 A (3) DISALLOW ONLY REVENUE EXP...EXCEEDING  Rs 20000 ..

purchase of fixed assets will come in balance sheet not in p & L a/c...so it is not disallowed as per sec 40 A(3)...and moreover this section will not applicable to any assets where you are providing depreciation...but this disallowance will be applicable if you purchase equipment for research purpose, here you are claiming deduction not depreciation...

 

Cash payments in excess of Rs. 20,000 towards any type of revenue expenditure is disallowed. In that case payment can be made through account payee cheque. However, purchase of fixed assets amounts to capital expenditure & hence not disallowed. Depreciation can be claimed.

 

 

Hi Everyone!

I have a serious doubt about whether depreciation can be claimed. Please refer Vinod Singhania CA FINAL Book Page 399, Para 148.3, 2011-12, 46h Edition Under Section 40A(3) in which he says that if you make a payment above Rs. 20,000 except by account payee check i.e by Cash or bearer cheque etc then the deduction under sections 30 to 37 cannot be claimed. For example if a an assessee purchases a plant & Machinery for Rs. 400,000 depreciation of 15% on Rs. 400,000 i.e Rs. 60,000 will be disallowed under sec 40A(3)

Please clarify. Please provide any case laws regarding the above.

 

Pls mention the section under which Depreciation can be claimed?

no depriciation claimed is not a cash expenditure    it is a non cash expenditure   i.e u need not pay any cash to anybody

Hey friends what if assessee has paid that amount in two installments i.e. on one day Rs.19,000/- and the balance on a next day after deducting TDS???then will it be allowed???


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