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TMI Blog2022 (1) TMI 178X X X X Extracts X X X X X X X X Extracts X X X X ..... nsidered opinion, the facts and circumstances narrated above fully support the assessee plea that the impugned payment falls under the ken of exemption to section 40A(3) contained under Rule 6DD. Hence, disallowance made in this regard is not legally sustainable. Hence, we set aside the order of Ld.CIT(A) and decide the issue in favour of the assessee. - I.T.A. No. 5772/Mum/2018 - - - Dated:- 3-1-2022 - Shri Shamim Yahya , Accountant Member Assessee by : None Department by : Ms. Smita Verma ORDER Per Shri Shamim Yahya (AM) :- This appeal by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals)-2 dated 26.06.2018 and pertains to assessment year 2014-15. 2. Grounds of appeal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sary details were furnished, examined and placed on the record. After considering the submissions, the assessment order u/s 143(3) of the Act, was finalized on 30.12.2016 at total income of Ks 16.24.S90/- after making addition of ₹ 4,16,022/-, u/s 40(a)(ia) for mm deduction of tax and ₹ 3.14.728,-. u/s 40A(3) of the Act. for incurring expenditure in cash. Further during the year the assessee had paid interest, amounting to ₹ 4.16.022/-, to Bajaj Ruserv (P) Ltd (₹ 98.591/-), ACI Tenancies (₹ 59.776A), Tata Motors Finance Ltd (1,52,304.37), Tata Motors Finance Ltd. (₹ 99,644.53) and Magma Fencorp Ltd (₹ 5,706/-), which are Non Banking Financial Companies, without deducting tax, as per provisions of Se ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s Viz;. Bajaj Fincorp (P) Ltd. ACI Tenanciers. lam Motors Finance Ltd and Magma Fincorp Ltd.. paid against loans, for non deduction of lax at source, while paying ; crediting the said amounts, in favour of these NBFCs. During the course of appellate proceedings it is claimed that the appellant had taken loan from these NBFCs for business purpose and the repayments of these loans were made through equated monthly installments, which comprised of principal as well as interest amounts. It is further claimed that these companies do not accept EMTs net of TDS, therefore, it was not possible to deduct TDS on the said amounts. It is also contended that these NBFCs are regularly filing their income tax returns, by offering the said interest i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... incipal and interest component in the EMIs for repayment of loans. In view of the above facts, the claim of the appellant, in my considered view is admissible. The AO, therefore, is directed to allow the interest expenses, in respect of those NBFCs. in whose cases the appellant had filed the certificates from the accountants of concerned deductee(certifying the inclusion of said interest incomes in their returns of income and payments of due taxes there upon), after verifying the same. The appellant is hereby also directed to submit these certificates before the AO, for his verification and necessary action at his end. This issue of addition is decided accordingly 5. Against the above order, assessee is in appeal before the ITAT. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that no milk processing plant can run without making these types of cash payments, therefore, the same are covered under the exception clause of the Act. The contention of the Ld.AR has been considered and noticed that he has not brought any material evidence on record to substantiate his claims and circumstances which have forced it to incur such payments in cash, that to when appellant had made similar payments through banking channels. In the absence of any credible evidence regarding above claims., the contention o the appellant is not tenable, therefore, rejected and the disallowance of ₹ 3,14,278/- , made u/s 40A(3) of the Act, by the AO, is hereby sustained and this ground to appeal to this extent is dismissed. 8. Against ..... X X X X Extracts X X X X X X X X Extracts X X X X
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