9911796707
TMI Blog2022 (5) TMI 829X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts of the case are that the assessee is a Builder and Developer engaged in civil construction and also rendering allied legal and technical services. A return was filed declaring total income of Rs.1,10,61,126/-. During the course of assessment proceedings, the AO observed that the assessee made certain payments through bearer cheques amounting to Rs.24,65,500/- which were in violation of section 40A(3) of the Act. On being called upon to put forth its stand, the assessee submitted that all the payments were made to Kharjul family members through bearer cheques during the course of carrying out its business activity. Commercial expediency was stated to be the reason for making payments through bearer cheques. The AO discussed one-by- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rts including the Hon'ble Bombay High Court in Madhav Govind Dulshete Vs. ITO (2018) 259 Taxman 949 (Bom.), the Hon'ble Madras High Court in Vaduganathan Talkies and others Vs. ITO (2020) 428 ITR 224 (Mad.), the Hon'ble Karnataka High Court in Nam Estates Pvt. Ltd. Vs. ITO (2020) 428 ITR 186 (Kar.) and the Hon'ble Calcutta High Court in Bagmari Tea Company Ltd. Vs. CIT (2001) 251 ITR 640 (Cal.) have confirmed the disallowance where the payment was made in cash exceeding the stipulated amount notwithstanding the genuineness of the transaction. 6. The assessee in Madhav Govind Dulshete (supra) was engaged in the business of sale of Kerosene which was purchased from notified dealers. He made purchases of Kerosene from certain companies. Some ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee made total payment of Rs.27,97,856/- to various persons through bearer cheques. Explanation was tendered about payments amounting to Rs.7,87,800/- which was accepted by the AO. Remaining amount of Rs.20.05 lakh was paid to contractors towards weekly bill of labour. The assessee contended that the payment was covered under Rule 6DD(k) being payment made to an agent. The AO rejected this contention, which got affirmed in the first appeal. 9. After considering the rival submissions and perusing the relevant material on record, it is found as an admitted position that the assessee paid the amounts in question to the labour contractors in violation of section 40A(3) of the Act. The case of the assessee is that the payments were covered un ..... X X X X Extracts X X X X X X X X Extracts X X X X
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