Save Rs 499 on a 2-Year Ad-Free CAclubindia Pro Membership. Subscribe Now!

Section 40A(3)_Cash payment

Others 437 views 12 replies

Ayushi Dubey

7 Points Posted on 11 April 2021

Reliance industries paid 30000 to a transport company in a day. Is the expense Disallowed as per proviso.

Replies (12)

CA. Sourav Sarkar

Chartered Accountant

24588 Points Posted on 11 April 2021

No, it will not be disallowed as for transporters cash limit is 35000 rupees in a day, so for 30000 rupees it is allowed u/s 40A(3), no problem

Ankit Neema

2742 Points Posted on 11 April 2021

No disallowace, as for Transporter limit is Rs. 35000

sabyasachi mukherjee

Profession Business

28207 Points Posted on 12 April 2021

Disallowance while computing profits and gains from business and Profession

expenses greater in cash of 30000 is disallowed and will be considered to be added to profit.

Ankit Neema

2742 Points Posted on 13 April 2021

Mukherjee JI Please read the section again

CA. Sourav Sarkar

Chartered Accountant

24588 Points Posted on 13 April 2021

Sabyasachi please read the section

Puneet Matha

32 Points Posted on 14 April 2021

No, it won't be disallowed when payment to transporter is upto Rs.35,000

CA Puja Sharma

Chartered Accountant

5010 Points Posted on 14 April 2021

Yes, it won't be disallowed as the limit is Rs. 35,000 for transporters

sabyasachi mukherjee

Profession Business

28207 Points Posted on 14 April 2021

I assumed its paid in cash.
the section tells that if its Rs
35000 in a single contract or Rs. 1 lakh in a day.
I ASSUMEE ITS PAID IN CASH.
SO HENCE ITS NOT DISALLOWED.