Cash payment for Purchase at remote locate & desert of Rajasthan allowable- Section 40A(3)

Mana Ram Ganpat Ram & Co. Vs ITO (ITAT Delhi) Reading of Section 40A(3) of the Act makes it clear that any payment in excess of 20,000/- should be made by crossed cheque or crossed bank draft. On failure to do so, the said payment would be disallowed. Admittedly, the assessee has made the payment in cash. However, it would be relevant to note that before us, Learned AR has pointed to the fact that entire business activity of the contract undertaken by assessee was on behalf of Govt. agencies, at remote locate and desert of Rajasthan namely; Bikaner and Jaisalmer. The impugned payments has ...