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2020 (10) TMI 37 - HC - Income TaxAddition u/s.40A(3) - cash payments were effected by the assessee for the purpose of acquiring rights to screen movies in their theatres as exceeded ₹ 20,000/- - nature and extent of banking facilities available, consideration of business expediency and other relevant factors - Whether Tribunal was right in holding that Rule 6DD has not been satisfied? - HELD THAT:- Correct test to be applied is to examine as to whether the expenses would fall under any one of the exceptional circumstances set out in Rule 6DD of the Rules. Concept regarding business expediency or commercial expediency can hardly be canvassed by the assessees, as the assessees had been periodically adopting the modes by effecting cash payments. Therefore, concurrently the two authorities and the Tribunal have held against the assessees and we are not expected to examine the correctness of the impugned order as if exercising powers as the third appellate authority and what we are expected to do is to consider as to whether any substantial question of law arises for consideration in these appeals, while exercising power under Section 260A of the Act. No question of law, much less substantial question of law arises for consideration in these appeals. Assessment years under consideration in these appeals are 2014-15 and 2015-16 when the said Rules stood deleted and therefore, the Revenue is right in contending that the genuinity of the transaction is hardly a matter, which should weigh in the minds of the Assessing officer while examining as to the whether the assessees had violated Section 40A(3) of the Act. - Decided against assessee.
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