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2019 (4) TMI 1907 - AT - Income TaxDisallowance u/s 40A(3) - cash payments made for purchasing film rights for exhibiting in their theatres - whether the assessee had brought in sufficient evidence to show that there was indeed an exceptional circumstance warranting the payments in cash? - HELD THAT:- The answer is a firm No. It might be true that exceptions mentioned in Rule 6DD are not exhaustive and there could be other extraordinary circumstances where business expediency required payments in cash. However, in my opinion, once an assessee say that its case fall within the proviso, it needs to prove it by strict evidence and not on the basis of preponderance of probability. Assessees were not able to bring out any records to prove the existence of any extraordinary circumstance requiring them to effect payments in cash - lower authorities were justified in making the disallowance u/s.40A(3) - Decided against assessee.
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