Income Tax : Section 40A of the Income-tax Act restricts the deduction of specified business expenses where statutory conditions are not fulfil...
Income Tax : The Income-tax Act contains strict provisions under Sections 40A(3), 269SS, 269ST, 269SU, and 269T to regulate cash transactions, ...
Income Tax : Learn if cash payments over ₹10,000 for electricity bills are allowed under Section 40A(3) of Income Tax Act. Understand exempti...
Income Tax : Section 40A(3) restricts cash payments exceeding ₹10,000 in business transactions. Exceptions apply for specific cases like tran...
Income Tax : Explore the rules and regulations governing cash transactions in real estate deals to ensure tax compliance. Learn about permissib...
Income Tax : It is suggested that there should be a positive provision under the I.T. Act that any transaction involving more than Rs.3,00,000/...
Income Tax : The Hyderabad ITAT held that incomplete data retrieved from an inoperative computer could not prevail over audited books of accoun...
Income Tax : The Tribunal deleted the disallowance after finding no evidence that cash rent payments exceeded ₹10,000 on any single day. The ...
Income Tax : Additions made by attributing the commission income earned by PSPL as undisclosed income of the Assessees were held unsustainable ...
Income Tax : The ITAT Kolkata held that cash payments made through agents for procuring paddy from farmers were covered by Rule 6DD exceptions....
Income Tax : The Bangalore ITAT held that a Section 40A(3) disallowance cannot be made on the assumption that cash payments might have exceeded...
Keeping a check on cash transactions under income tax (with illustrations) INTRODUCTION: We come across a common saying ‘Cash is King,’ however idle cash can never generate any interest income, therefore channelizing the idle money into digital mode shall generate income. The Cashless economy is a system where majority of transactions take place by modes […]
Example: Five separate invoices of Rs. 60,000 each were issued to a customer. The customer intends to make cash payment in installments of Rs. 10,000 each on daily basis. State the applicability of Sec 269ST and 40A(3)? As per sec 40A(3), if any payment is made by an assessee to a person in a day above Rs.10,000, other than […]
Analysis of Section 40A(3) and 40A(3A) (a) Analysis of sec 40A(3) of the Act. Where payment is made in the year the expenditure is incurred: 100% disallowance of payment if in excess of Rs. 10,000 and not by a/c payee cheque/draft/ECS. [Sec 40A(3)] There are following two conditions for the applicability of this section. If both of […]
We were told by history that before advent of cash there was concept of barter system though barter system where there was no currency ‘no cash’ and things were exchanged according to needs and sooner society realized that barter system having its own series of advantages and disadvantages need to be left behind with time and later on various personalities, kings and governments introduced new coins and currency made from time to time making impressions of their choice on such coins.
Understanding Section 40A(3) of Income Tax Act, 1961 read with Rule 6DD. Learn about cash payment limits, exceptions, and important notes.
Krishna, Today is 13th October last day for the promotion of Elections. In the chaos of election, crores of rupees were ceased. During this period Election Commission has laid many restrictions on cash transaction. But what are the provisions of cash transactions under Income Tax Act?
Revenue is right in contending that the genuinity of the transaction is hardly a matter, which should weigh in the minds of the Assessing officer while examining as to the whether the assessees had violated Section 40A(3) of the Act.
The issue under consideration is whether the disallowance under Section 40A(3) of the Act as made by the Assessing Officer is sustainable under Income Tax Act when banking facility was available but the bank account could not be operated by the very bank themselves because of an order of attachment passed by the ESI Department.
Assessee couldn’t demonstrate with cogent evidences that there was business expediency or sufficient cause for such cash payment. Assessee failed to prove that the case was covered in the exception clause as provided under section 40A(3) read with Rule 6DD.
Under the existing provisions of the Act, revenue expenditure incurred in cash exceeding certain monetary threshold is not allowable as per sub-section (3) of section 40A of the Act except in specified circumstances as referred to in Rule 6DD of the Income-tax Rules, 1962.
