• Jul
  • 09
  • 2009

Payment in cash to transporters upto 35000 allowed from 01.04.2009

Enhancement of limit for disallowance of expenditure made in the case of transporters Under the existing provisions of the Income-tax Act, where an assessee incurs any expenditure, in respect of which payment in excess of Rs 20,000 is made otherwise than by an account payee cheque or account payee bank draft, such expenditure is not allowed as a deduction. Given the special circumstances of transport operators for incurring expenditure on long haul journeys, it is proposed to raise the limit of payment to such transport operators otherwise than by an account payee cheque or account payee bank draft to Rs 35,000/- from the existing limit of Rs 20,000/-. For this purpose a new proviso is proposed to be inserted after the proviso in sub-section (3A) of section 40A of the Income-tax Act. The existing limit for other categories of payments will remain at Rs 20,000/- subject to the exceptions declared in Rule 6DD of the Income-tax Rules. The proposed amendment will apply to transactions effected on or after the 1st October, 2009. [Clause 16]

Sandeep Kanoi

9 Responses to “Payment in cash to transporters upto 35000 allowed from 01.04.2009”

  1. Harash says:

    If bill of transporter is Rs. 42500/- of dtd. 25.04.12, can we make paymnet Rs. 35000/- on 25.04.12 and rs 7500 on next day is it allowed?

  2. HEMANT says:

    FREIGHT PAYMENT(CASH) TO A PARTICULAR PARTY ON THE SAME DAY SHOULD NOT EXCEED 35000
    note: aggregate payment i.e if a party has made payment to ‘pall transport’ of 20000 on 7/1/11 and 25000 again to pall transport on the same day, then the whole 45000 will not be allowed as deduction

  3. girdhar says:

    I mean, Rs. 70000 bill raised of Transporter on 01.05.2010 and cash payment Rs. 35000 on 01.05.10 and Rs. 35000 on 02.05.10 intentionally.

    Is it allowed???

  4. Satyendra says:

    I mean, Rs. 70000 bill raised of Transporter on 01.05.2010 and cash payment Rs. 35000 on 01.05.10 and Rs. 35000 on 02.05.10 intentionally.

    Is it allowed???

  5. Satyendra says:

    one bill is more then 40000/-. Can pay same day cash 35000/- and balance payment on other days?
    this is exceptable or not?
    please reply.

  6. M.K. Ranka says:

    bill is more then 40000/-. Can pay same day 35000/- and balance payment on other days?
    this is exceptable or not?
    please reply.

  7. ankit garg says:

    jo rs.35000 payments h vo 1 day me 1 bill ke aginst karna h ya total hum kitne bhi bill ho rs.35000 hi karne h

  8. MANISH SHARMA says:

    IS THIS AMENDMENT EFFECTIVE NOW AND IS APPLICABLE FOR THE PREVIOUS YEAR 2010-2011….???
    REPLY SOON

  9. Anil Nair says:

    fyi

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