Cash Payment to farmers for agricultural produces allowable | Section 40A(3)

Krishnasa Bhute Vs ITO (ITAT Bangalore) ITAT held that when considering Rule 6DD(e)(i) of the Income Tax Rules, 1962, and when the payment was made by cash exceeding Rs. 20,000/-, it was permissible if the same was paid for purchase of agricultural produces. If there are entries in the books of accounts and payment is shown to have been made to farmers and when receipts were also produced but the assessee could not produce the farmers/list of farmers for which a reasonable explanation was also given, no addition could be made u/s.40A(3) of the Act. Respectfully following the aforesaid decision...