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Querist : Anonymous (Querist) 18 November 2009 This query is : Resolved
in dis can we make payment of above 20000 if the individual invoices do not exceed Rs 20000

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Raj Kumar Makkad (Expert) 18 November 2009
Yes. we can make payment in the given circumstances.

Vineet (Expert) 20 November 2009
The query is not very clear. Presuming that you want to make payment of an amount more than Rs 20,000/- otherwise than by account payee cheque/ bank draft etc. in such case as per current provisions if aggregate of payments made to a single person in a day exceed Rs 20,000/-, the entire payment is disallowed.

Though the above amended provisions effective from 1-4-2009, makes it abundantly clear that the incidence of cash payment to a person in a single day is the fact para materia and not the number of invoices or items of expenses, earlier also a similar stand had been upheld in the case of CIT vs Shanmuga (146 ITR 600).

Hence, as of now any single or multiple cash payments to a single person in a day aggregating more than Rs 20,000/- shall be disallowed irrespective of number of invoices except under certain specified circumstances considering business expediency and other factors (refer rule 6DD).

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