cash payment stamp duty u/s 40A(3), Income Tax

[satbir singh wahi]

Stamp duty paid to state govt. for purchase of land , whether covered by rule 6DD(b).. The A.O. has disallowed the stamp duty paid in cash for purchase of land.

Posts / Replies

[BSNL PUNJAB TELECOM CIRCLE]

I think it would be out of the purview of Section 40A (3) as  the payment is being made to State Govt. Moreover, if finally land is to be capitalised in the books of accounts, then it shall not be considered against any expenses. Hence no disallowance under Section 40A(3).