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2015 (8) TMI 1076 - AT - Income TaxAddition U/s 40A(3) - book entries in respect of incentives. AO was of the view that they amounted to cash payments CIT(A) deleted the addition - Held that:- Merely because some book entries are routed through the assessee’s cash book the learned Assessing Officer cannot ignore the real nature of the transactions and arbitrarily hold them as cash payments. They are neither cash payments nor claimed as expenditure by the assessee to be held as violation of Section 40A(3) of the Act. See Attar Singh Gurmukh Singh Vs. ITO and Sutlez cotton Mills Ltd. vs CIT (1991 (8) TMI 5 - SUPREME Court ) The fact that these were book entries based on credit and debit notes have not been disputed. Similarly, the amounts transacted were not claimed as expenditure and represented only quantified amounts of incentives provided as per sales and distribution policy of the GPI, they cannot be held as cash payments by any stretch of imagination. These glaring facts could not be controverted by the learned Sr.D.R. In view of the foregoing, we find no infirmity in the order of the learned CIT(A), which are based on proper appreciation of facts and law and are upheld. - Decided against revenue.
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