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TMI Blog2014 (2) TMI 471X X X X Extracts X X X X X X X X Extracts X X X X ..... yment in cash exceeding Rs. 20,000/- made to different parties on account of some bonafide reason does not attract provisions of section 40A(3) of the Act. He submitted that the AO had disallowed the payments made in cash exceeding Rs. 20,000/- also in cases of some parties where it was through account payee cheque or due to some bonafide reason. It was pointed out in its application moved u/s 154 of the Act that payment to OM Advertising was made through account payee cheque and bank statement was submitted alongwith the application. Regarding the payment made to Timber merchant it was submitted that when the payment made on 5.4.2008 it was Saturday and bank was also closed at 12.30 pm. The timber merchant was not agreeing to sell timber t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onery to Shri S.K. Singh, Shri S.S. Chauhan and others except the payment made to OM Advertising of Rs. 2,66,74/- on 1.4.2008, Mahavir Timber of Rs. 25,965/- and Rs. 26,770/- on 5.4.2008 on the basis that no documentary evidence was furnished in support thereof. About the explanation of the assesee regarding payment of Rs. 26,674/- made to Om Advertising on 1.4.2008 that it was made through account payee cheque No. 127225 drawn on Indus Ind Bank in favour of OM advertising, we are of the view that non consideration of the same was mistake apparent from record in the order passed u/s 154 of the Act by the AO. In the case of Mahavir Timber to whom payment of Rs. 25,965/- and Rs. 26,770/- on 5.4.2008 were made the submission of assessee before ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ation regarding the cash payment exceeding Rs. 20,000/- made to different parties under different circumstances were furnished before the AO. On the basis of which only he made disallowance of RS. 296908/- u/s 40A (3) regarding the payment made on different dates. Subsequently application u/s 154 of the Act was moved by the assessee pointing out certain mistakes apparent from the record in the assessment order and appreciating the same the AO had deleted the disallowance of Rs. 1,40,000/-. Under these facts and circumstances when the provisions of section 40A (3) must not be read in isolation or exclusion of Rule 6DD as an established position, there was no reason to arrive at a conclusion that the disallowance was due to concealment of par ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that there was mistake apparent from record in the assessment order regarding non acceptance of explanation of the assessee about the payment made to the parties except payment made to Om Advertising and Mahaveer Timber. The AO has deleted the disallowance made on account of the payment to remaining 8 parties. Under these circumstances it cannot be inferred beyond doubt that there was concealment of particulars of income or furnishing inaccurate particulars thereof on the part of the assessee regarding the payment made to OM Advertising and Mahaveer Timber explanation of which has not been accepted by the AO. We however mentioned over here that in the above appeal preferred by the assessee against the disallowance made on account of paym ..... X X X X Extracts X X X X X X X X Extracts X X X X
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