Income tax- payment related matters

Yes...It Will Attract the Concerned Provision...

Refer section 40A(3) of it act

The provisions of Sec 40(a)(3) will be applicable subject to the execeptions given under Rule 6DD.. If your  seller or your payment falls under the purview of any of the execeptions of 6DD, tax disallowance will not be applicable. See to it.

Hi..!!!

If you dont adjust and recover the same amount from the seller then this provision in my view would not be applicable..(thought nothing such is written in provision). I would suggest you not to adjust it but show it as that u would recieve it and make such entries.

Apart from this if payment is made to a transporter then limit would be 35000 and not 20000.

u/s 40 A (3) payment made in cash exceeding Rs 20000/- and Rs 30000/- in case payment made to transporter is disallowed . under rule 6DD there is  exemption for payment to suppliers, purchasing of fixed assets,etc.