Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2014 (3) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2014 (3) TMI 462 - AT - Income TaxConfirmation of addition made u/s 40A(3) of the Act – Payments made does not exceeded the limit – Held that:- The assessee was required to establish satisfaction of the conditions prescribed in Rule 6DD when payments were made in cash at a time in excessive of the amount prescribed u/s. 40A(3) of the Act - when payments were made by the assessee were within the limit specified u/s. 40A(3) of the Act, the genuine business expenditure could not be disallowed by the AO merely because the assessee could not satisfy to the AO about business exigencies for which payments were made in cash – Relying upon CIT vs. Aloo Supply Company [1979 (12) TMI 60 - ORISSA High Court] - where singular payment has not exceeded Rs. 20,000/- the department was not justified in invoking the provisions of section 40A(3) of the Act by aggregating the entire payment made to a party – Decided in favour of Assessee. Disallowance of telephone expenses for personal use – Held that:- The decision in Sayaji Iron and Engineering Co. vs. CIT [2001 (7) TMI 70 - GUJARAT High Court] followed - Once any remuneration was fixed as provided in section 309 it was not possible to state that the assessee incurred the expenditure for the personal use of the directors - Even if there was any personal use by the directors that was as per the terms and conditions of service and, in so far as the assessee was concerned, it was business expenditure and no part of the expenditure could be disallowed – revenue could not controvert the findings of the decision followed – thus, the disallowance made on the ground of personal use of telephones is allowed – Decided in favour of Assessee.
|