Aggregated Cash Payments Cannot Trigger Section 40A(3) Disallowance

Aqua World Exports Private Limited Vs DCIT (ITAT Chennai) Section 40A(3) Disallowance Unsustainable When Cash Payments Do Not Exceed ₹20,000 Per Person Per Day The Chennai ITAT held that disallowance under Section 40A(3) cannot be made by merely aggregating total cash expenditure, without examining whether individual cash payments exceeded the prescribed threshold per person per day. In this case, the assessee, engaged in the seafood export business, incurred expenditure on purchase of ice, an essential input for preservation of fish. Although a substantial portion of the payments was made i...