Section 40A(3)

Hi Mr.Ramasamy hope this reply will clear your confusion.

In the front side of cheque on the left top corner there will be 2 parallel line which will be drawn by the payer which is called as crossing i.e. crossed cheque. it can be encashed only through account.

as per section 40A(3) on income tax act any payment exceeding Rs.20000 should be paid only crossed cheque or crossed DD else that particular payment will be disallowed.

is dat k.....

Thank for your reply.  As per guideline answers issued by ICSI , 20% of amount is disallowed when the payment is made to supplier by crossed cheque.  It means crossed cheque and account payee cheques are same ? Please help me in this reagard

Dear sir,

Please clarify, whether cheque favouring "Yourselves" is to be crossed or not ?

Originally posted by : Karthikeyan N
	Dear sir, Please clarify, whether cheque favouring "Yourselves" is to be crossed or not ?

No. 

Crossing is done so that payment is made only to an account, and not in cash.

Here cash is withdrawn by holder, so it should not be crossed.