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2018 (12) TMI 814 - AT - Income TaxAddition u/s 40A(3) - cash payment for freight charges paid to clearing and forwarding against for clearing our goods for exports - Held that:- In the instant case the assessee has made payment to its clearing and forwarding agent mostly through banking channel except in few instances where the payment was made in cash. The payment made by the assessee through banking channel was accepted by the AO but the same payment made to the same party in cash was disallowed under the provision of section 40A(3) of the Act. From the above facts there remains no ambiguity that the payment/expenses were not doubtful and these were incurred exclusively for the purpose of the business. The party to whom the payment was made in cash was a genuine party. In such circumstances we note that the Hon’ble ITAT, Ahmadabad in the case of M/s. Shiv Krupa Tin Containers v/s ITO [2016 (9) TMI 445 - ITAT AHMEDABAD]allowed the deduction to the assessee - disallowances u/s 40A(3) of the Act, cannot be made if the genuineness of the transaction has not been doubted by the authorities below - we direct the AO to delete the addition made u/s 40A(3) - Decided in favour of assessee.
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