Section 40A(3)

[Sheetal Bansal]

If a company paid in cash salary to his employee suppose 56000 p.m.and it includes all the allowances and perquisites.whether it is covered under Payment Exceeding as there is one salary slip for one Employee.

Case 2: If a company paid in cash salary to an employee 38000 p.m. only basic means nothing allowance or Perquisite then whether this cash payment is covered under payment Exceeding.

Case 3: If an employee go for tour (business) and company pays him 40000 in cash as traveling Allowance then whether this is covered under Payment Exceeding or not. if not then why it is not covered.

[CAGOPALJI AGRAWAL]

Case 1 and 2 would hit by the provision of section 40A (3).

In case 3, if employee does not make the single payment exceeding the limit, then provision would not apply.

AI Summary

Cash payment limits: salary paid in cash may be disallowed if single payments exceed statutory threshold under Section 40A(3). Section 40A(3) applies to salary payments made in cash that exceed the prescribed single payment limit, covering both consolidated cash salary (including allowances and perquisites) and basic cash salary. By contrast, a cash travel allowance paid for business is not covered if no individual cash payment to the employee exceeds that single payment threshold.