EXPENSES PARTLY PAID IN BANKING CHANNEL AND PARTLY IN CASH

[KERAGODEGOPALARAO ANANTHARAO]

When An Expenditure is more than 10000 say 29000, I will discharge 20000 in banking channel and 9000 in cash, is it Not Attracted 40a(3).

AI Summary

Splitting payment into bank ?20,000 and cash ?9,000 keeps cash per payee under ?10,000, Section 40A(3) not triggered If the aggregate amount paid to a single payee in a day by non-prescribed modes (cash) does not exceed ?10,000, Section 40A(3) will not deny the deduction; splitting a ?29,000 expense as ?20,000 through bank (prescribed mode) and ?9,000 in cash (non-prescribed mode) means the cash component is below the ?10,000 threshold, so the disallowance under that provision would not be attracted.