Section 40A(3)

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83 Points Posted on 08 November 2008

Thanks for all who have given clarification about the said section.  But lot of people are telling about fixed  assets only.  I am asking about purchase of raw materials. Whether 20% will be disallowed when we make payment by crossed cheques. Since companies are making payment by account payee cheques.  Whether account payee cheques and crossed cheques are the same. Please clarify this.

Thanks in advance

 

 

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On 08 November 2008 at 20:39 Report
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79 Points Posted on 08 November 2008
Yes purchase of raw material will be disallowed, as it is an expenditure. now diff between account payee cheque & crossed cheque:- crossed cheque cannot be encashed on bank counter however it can be endorssed while account payee cheque can be deposited only in the account of the persone whoes name is specified over it....
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On 08 November 2008 at 20:57

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