payment of cash more than 20000 as security deposite which is refundable or adjustable in future.
is it contravention of sec 40A(3)
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Sec 40a(3)
Replies (10)
it is not a expenditure.it is a security deposit.
SEC 40 A(3) APPLIES FOR EXPENDITURE.NOT SECURITY DEPOSIT.
it is not a expenditure.it is a security deposit.
SEC 40 A(3) APPLIES FOR EXPENDITURE.NOT SECURITY DEPOSIT.
Agreed with CA Parveen Singh ji, that ist applicable on the expenditure and not on receipts, security deposit.
As per section 40A(3) of the Income Tax Act, 1961 " Disallowance of 100 % expenditure exceeding Rs 20,000/- if payment is made by any mode other than account payee cheque or draft ". therefore , the section uses the word expenditure and then only it would be disallowed . So,it does not apply to security deposit..
sec 40A(3) is apply only on revenue expenditure not on capital expenditure so disallow,,,,,
As per section 40A(3) of the Income Tax Act, 1961 " Disallowance of 100 % expenditure exceeding Rs 20,000/- if payment is made by any mode other than account payee cheque or draft ". therefore , the section uses the word expenditure and then only it would be disallowed . So,it does not apply to security deposit..
| Originally posted by : CA PRAVEEN SINGH | ||
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it is not a expenditure.it is a security deposit. SEC 40 A(3) APPLIES FOR EXPENDITURE.NOT SECURITY DEPOSIT. |
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SECTION 40A(3) APPLIES TO EXPENDITURE ONLY & NOT TO SECURITY DEPOSIT
IN THE ABOVE CASE 40A(3) DOES NOT APPLY BUT SEC-269SS GET ATTRACTED BECAUSE SECURITY DEPOSIT TAKE THE NATURE OF ADVANCE AND THEREFORE AS PER SEC-269SS ANY ADVANCE IN EXCESS OF 20,000 MUST BE MADE BY ACCOUNT PAYEE CHEQUE OR DRAFT.
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