10-07-2011, 03:46 PM
<blockquote id="quote"><font size="1" face="Verdana, Arial, Helvetica, san" id="quote">quote<hr height="1" noshade id="quote"><i>Originally posted by Omeir</i>
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Secondly I am aware of this that a ltd company cannot make cash payment of any invoice of more than Rs 10,000. The payment has to be by cheque and crossed. Also that under one expense head such company cannot make a payment of Rs 50,000 in cash.
Please guide me in this regard as I find it quite bewildering.
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">Firstly, according to s.21(l), it is not only limited company but every business concern including individual that has to make payment through cross cheques, if such payments exceed in aggregate, Rs.50,000 under single account head.
Secondly,the second proviso is exception to this rule. It says that to payments below Rs.10,000 , this rule (clause l) shall not apply. Hence, I think, under one expense had, business concern may pay more than Rs.50,000, provided that each single transaction is below Rs.10,000. If one has incurred annual expenditure on petrol amounting to Rs.1 Lac. But all single transactions are below Rs.10,000, then he has not need to pay by cross cheque and his expense will not be disallowed
For the purpose of salary read clause m of s.21.
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Secondly I am aware of this that a ltd company cannot make cash payment of any invoice of more than Rs 10,000. The payment has to be by cheque and crossed. Also that under one expense head such company cannot make a payment of Rs 50,000 in cash.
Please guide me in this regard as I find it quite bewildering.
<hr height="1" noshade id="quote"></font id="quote"></blockquote id="quote">Firstly, according to s.21(l), it is not only limited company but every business concern including individual that has to make payment through cross cheques, if such payments exceed in aggregate, Rs.50,000 under single account head.
Secondly,the second proviso is exception to this rule. It says that to payments below Rs.10,000 , this rule (clause l) shall not apply. Hence, I think, under one expense had, business concern may pay more than Rs.50,000, provided that each single transaction is below Rs.10,000. If one has incurred annual expenditure on petrol amounting to Rs.1 Lac. But all single transactions are below Rs.10,000, then he has not need to pay by cross cheque and his expense will not be disallowed
For the purpose of salary read clause m of s.21.
