Buy laptop in cash 40000 by a company is disallowed or not

100% disallowed u/s 40A(3)

depreciation not allowed

sorry, 100%disallowed u/s 43, newly amended

If depreciation not allowed. Then how to treat the asset and how to make in book entry

As per the Proviso to Section 43(1) of the Income Tax Act 1961, where the assessee incurs any expenditure for acquisition of any asset or part thereof in respect of which a payment or aggregate of payments made to a person in a day, otherwise than by an account payee cheque drawn on a bank or an account payee bank draft or use of electronic clearing system through a bank account, exceeds ten thousand rupees ( 10,000 ), such expenditure shall be ignored for the purposes of determination of actual cost.

Hence, it is 100% disallowed and no depreciation can be claimed u/s 32 of the Income Tax Act 1961 read with Rule 5 of the Income Tax Rules 1962.

Warm Regards.

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