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Payment to PGVCL BILL IN CASH.

Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 nayan asked about 3 years ago

If company or firm required to tax audit can make payment to PGVCL BILL IN CASH FOR MORE THE RS. 20000/- ??

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2 Answers
Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 acharya answered over 2 years ago

Regarding you query on cash payment to PGVCL I would like to convince that As per provision of Section 40A (3)(a) of the Income-tax Act, 1961any expenditure incurred in respect of which payment is made in a sum exceeding Rs.20,000 /- otherwise than by an account payee cheque drawn on a bank or by an account payee bank draft, shall not be allowed as a deduction from your income. So the net effect will be your income will be higher and you need to pay higher tax.

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Avatar 37a3bd7bc7328f0ead2c0f6f635dddf60615e676e6b4ddf964144012e529de45 Prabhash answered about 3 years ago

Hi Friend, Regarding you query on cash payment to PGVCL I would like to convince that As per provision of Section 40A (3)(a) of the Income-tax Act, 1961any expenditure incurred in respect of which payment is made in a sum exceeding Rs.20,000 /- otherwise than by an account payee cheque drawn on a bank or by an account payee bank draft, shall not be allowed as a deduction from your income. So the net effect will be your income will be higher and you need to pay higher tax. You may also note that provision of tax audit will not make any difference on the allowabilty and disallowability of the expense made in cash.

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