Provisions of section 206aa applies where the pan is not ava

Yes It will..!!

From the above query i assume, If it is an cash payment then it would be disallowed.

The Limit of 20,000 is reduced to 10,000 from 01-04-2017 onwards.

And if this be the case where TDS is invloved then for not having the PAN the tax would be deducted at 20%

Regards,

Sunil Sharma

https://www.pwc.in/assets/pdfs/news-alert-tax/2016/pwc_news_alert-28_june_2016-cbdt_notifies_conditions_for_non-resident_deductees_to_avail_relaxation_from_higher_withhol.pdf