TMI Blog2011 (7) TMI 1386X X X X Extracts X X X X X X X X Extracts X X X X ..... ORDER Heard Sri Shambhu Chopra, learned counsel for the department and Sri S.K. Garg appearing for assessee . For the assessment year 1986-87 the assessee had incurred certain expenses for which payments were made in sums exceeding two thousand five hundred rupees, in cash. The aggregate amount of such expenses, paid in cash was ₹ 2,31,530/-/ out of which a sum of ₹ 92,855, w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cash alone were possible. The payment is thus covered under the exception provided in the second proviso to Section 40A(3) of the Act. The Tribunal also referred the findings of CIT(A) that the drivers were transporting pipes to different destinations as per the terms of the orders of U.P. State Electricity Board and on such destinations neither the assessee had bank account nor the truck driv ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... business activities. There is no restriction on the assessee in his trading activities. Section 40A(3) only empowers the Assessing Officer to disallow the deduction claimed by way of expenditure in respect of which payment is not made by crossed cheque or crossed bank draft. The payment by crossed cheque or crossed bank draft is insisted only to enable the assessing authority to ascertain whether ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Assessing Officer that the payment could not be made by a crossed cheque drawn on a bank or by a crossed bank draft- (1) due to exceptional or unavoidable circumstances; or (2) because payment in the manner aforesaid was not practicable or would have caused genuine difficulty to the payee, having regard to the nature of the transaction and the necessity for expeditious settlement thereo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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