Income Tax - I would like to highlight on a very important topics CASH TRANSACTION in business as well as other contexts. CASH Payment is common practice in business. Either in small or large business, CASH is very important part of business. Hence it is very important to understand and take precaution while making the payment to someone […]...
Read MoreIncome Tax - Section 40A(3) was introduced by the Finance Act 1968 as a provision designed to counter evasion of tax through claims for expenditure shown to have been incurred in cash with a view to frustrating proper investigation by the Department as to the identity of the payee and the reasonableness of the payment....
Read MoreIncome Tax - Section 40A(3) and Section 40A(3A) deals with Disallowance of 100% of expenditure if payment is made by any mode other than account-payee cheque or draft in the year of expense or in the subsequent year / Years. Article explains provision of Section 40A(3) and Section 40A(3A) of Income Tax Act, 1961. Section 40A(3) of Income Tax [&hell...
Read MoreIncome Tax - Treatment of expenditures incurred by an assessee in excess of Rs. 20000/- (wef A.Y. 2018-19 Rs 10000/-) in cash or bearer cheque under section 40(A)(3) of the Income Tax Act, 1961...
Read MoreIncome Tax - The Government of India with an intention to evade black money and to discourage the cash transactions time and again taking various steps. Specially the Income tax Act is amended and provided with disallowances and stringent penal provisions for various types of cash transactions. Let us briefly understand some of such provisions here....
Read MoreIncome Tax - It is suggested that there should be a positive provision under the I.T. Act that any transaction involving more than Rs.3,00,000/– (Rupees Three Lacs) shall be invalid & illegal and would be a punishable offence, if amount is not paid by account payee cheque or account payee bank draft or use of electronic clearing system through a ban...
Read MorePr. CIT VS Jadau Jewellers & Manufactures (P) Ltd. (Rajasthan High Court) - When income of the assessee was computed by applying gross profit rate, there was no need to look into the provisions of section 40A(3), as applying the gross profit rate takes care of expenditure otherwise by way of cross cheque also. Following the same the action of Tribunal could not be held as u...
Read MoreDCIT Vs Allied Infra suppliers (ITAT Cuttack) - The provisions of section 68 cannot be applied to sundry creditors and the assessee cannot be applied to sundry creditors and the assessee cannot be asked to prove the 3 ingredients of cash credits in respect of sundry creditors....
Read MoreDCIT Vs M/s. Brilliant Sare Reality Pvt. Ltd. (ITAT Indore) - When cash payment was done on insistence of the seller, amount was duly recorded in the sale deed and no doubt was raised with regard to the genuineness of the transaction, disallowance u/s 40A(3) not justifiable....
Read MorePrime Infra Developers (P) Ltd. Vs ITO (ITAT Delhi) - Disallowance under section 40A(3) with respect to cash payment made by assessee to farmers on Sunday for purchase of agricultural land could not be disallowed as Sunday was bank holiday and rule 6D(J) was clearly attracted in assessees case as payment was made due to commercial expediency....
Read MoreM/s. Lion Mercantile P. Ltd. Vs ITO (ITAT Mumbai) - Where assessee’s debtor directly made payment through banking channel to assessee’s creditor to square up their account, provisions of section 40A(3) would not be attracted....
Read MorePr. CIT VS Jadau Jewellers & Manufactures (P) Ltd. (Rajasthan High Court) -
DCIT Vs Allied Infra suppliers (ITAT Cuttack) -
DCIT Vs M/s. Brilliant Sare Reality Pvt. Ltd. (ITAT Indore) -
Prime Infra Developers (P) Ltd. Vs ITO (ITAT Delhi) -
M/s. Lion Mercantile P. Ltd. Vs ITO (ITAT Mumbai) -
Kalyan Constructions Vs ITO (ITAT Hyderabad) -
Ayub Ali Vs ACIT (ITAT Jaipur) -
Kalyan Constructions Vs Income-tax Officer (ITAT Hyderabad) -
Kamta Prasad Mittal Vs Dy. CIT (ITAT Lucknow) -