Cash Payment more than Rs.20,000/-

[DHARMENDRA KASLE]

We ( PVt.Ltd.Co.) made cash payment for Office picnic Rs.20,000/- paid to Resort in FY 2011-12. Will it disallow under I.Tax Rule of the  Rule 40(A) 

AI Summary

Cash Payment for Office Picnic May Be Disallowed Under Income Tax Rule 40A(3) If Exceeding Rs. 20,000 A private limited company inquired about the tax implications of making a cash payment of Rs. 20,000 for an office picnic in the fiscal year 2011-12. The concern was whether this payment would be disallowed under Income Tax Rule 40A(3). The response clarified that if the cash payment exceeds Rs. 20,000, the provisions of section 40A(3) would indeed apply, potentially leading to disallowance of the expense for tax purposes.