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2016 (8) TMI 568

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..... 007 With TAX APPEAL NO. 935 of 2007 With TAX APPEAL NO. 936 of 2007 With TAX APPEAL NO. 938 of 2007 - - - Dated:- 11-8-2016 - MR KS JHAVERI AND MR. G.R.UDHWANI, JJ FOR THE APPELLANT : MR NITIN K MEHTA, ADVOCATE COMMON ORAL JUDGMENT (PER : HONOURABLE MR.JUSTICE KS JHAVERI) Since the common question of law arises for consideration in this group of appeals, they are being heard together and disposed of by this common oral judgment. 2. By way of these appeals, the appellant department has challenged the order passed by the tribunal whereby the Tribunal has dismissed the appeals of the revenue by confirming the order of the CIT (A) and reversed the order of the AO. 3. The short facts of the case are that during the .....

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..... most of the payments were freight charges, allowing which the CIT (A) has followed the decision of the Delhi Bench of the Tribunal in the case of Smt. Ninlal Vs. DCIT [68 TTJ 53], wherein the payment of freight charges in cash could not be disallowed u/s. 40A(3) as it is a general practice that transporters do not accept payments otherwise than in case. The CIT (A) has already disallowed a sum of ₹ 1,60,000, which was payment for purchase of chemicals. Therefore, we do not find any infirmity in the order of the CIT (A) in giving relief to the assessee of ₹ 1,42,17,740. The same is upheld. 5.2 In support of the submissions, learned Counsel for the department has placed reliance upon the decision of the Panjab and Haryana H .....

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..... ported in 68 TTJ 53 by Delhi Bench of ITAT by holding as under: Payment of freight charges in cash could not be disallowed us. 40A(3) as it is a general practice that transporters do not accept payments otherwise than in cash. It is also seen that in earlier years under similar circumstances no disallowance was made by the Assessing Officer. In view of above following the above decisions, cash payments in respect of freight charges are to be treated as covered under Rule 6DD(j) and the disallowance made are deleted. However, it is seen that a sum of ₹ 60,000/- in respect of purchase of chemicals was also paid in cash. In absence of any confirmation of the payee and in view of decision of payments and Haryana High Court i .....

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