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2022 (3) TMI 162 - HC - Income TaxDisallowance towards purchase of land u/s 40A(3) - Cash payment exceeding permissible limit - submission made by the counsel for the appellant is that ₹ 20,00,000/- had to be paid in cash as the transaction had to be closed and the money was required to be paid on a Sunday, when the Bank was closed - HELD THAT:- Tribunal, having regard to the totality of facts, has, in fact, remanded the matter to the AO for enabling the appellant to satisfy the AO as to why the payments in cash had to be made on a Sunday, and why the provisions of Section 40A(3) of the Act would not apply in the appellant’s case, when the land is reflected as a “non current investment” in the audited financial statements and is, consequently, not claimed as an expenditure in the Profit and Loss Account. We had asked the learned counsel for the appellant as to whether any agreement to sell was executed between the parties prior to the sale.However, counsel for the appellant was unable to answer our query. We had also asked the learned counsel for the appellant as to whether any copy of the sale deed has been placed on record. Learned counsel for the appellant says that the copy of three [3] sale deeds, which are in issue, have not been placed on record. The interest of the appellant is still intact as the Tribunal has remitted the matter to the AO. The appellant, in our view, as correctly held by the Tribunal, needs to satisfy the AO as to whether in the facts and circumstances of the case, the provisions of Section 40A(3) of the Act would apply. The aspect of immediacy of making payment on a Sunday [i.e., a Bank holiday] may also have to be addressed. No interference is called for with the order of the Tribunal. - Appeal dismissed.
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