9911796707
TMI Blog2019 (12) TMI 1684X X X X Extracts X X X X X X X X Extracts X X X X ..... table explanation and there is a valid justification for not invoking the provisions of section 40A(3) of the Act. In our view the aforesaid decision of the Hon ble Karnataka High Court will not support the plea of assessee in the present case. The assessee in the present case except making a statement that cash payments were made on the last day of the month and cash payments were made keeping in view the business exigencies is not supported by any evidence as to whether the last day of the month is the last day for payment and the assessee would suffer any other consequences if the payment is not made beyond the last date of the month. The assessee has not made out any valid justification for not making the payments of sums of above Rs.20 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rounds of appeal which in relation to disallowance of 3,47,717 made by the AO by invoking the provisions of section 40A(3) of the Income Tax Act, 1961 [the Act]. 4. The assessee is an individual carrying on business in retail cloth under the name, Ostwal Clothing. In the course of assessment proceedings for the AY 2013-14, the AO noticed that the assessee had made cash payments to certain parties and those cash payments were claimed as expenditure in the Profit Loss account. The details of cash payments made by the assessee were as follows:- Sl. No Name of party Date of payment Inv.No Amount 01 Vimal Plastics 31.03.2013 2702 211363 02 Radhey Shyam Hosiery 31.03.2013 1479,2704 90454 03 A2A Clothing Co Pvt Ltd 31.03.2013 889,2707 45900 TOTAL ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... crossed and therefore was not in accordance with the mandate of section 40A(3) of the Act. The Hon ble High Court took the view that the explanation of assessee that DDs were not crossed because the suppliers wanted quick realisation was an acceptable explanation and there is a valid justification for not invoking the provisions of section 40A(3) of the Act. In my view the aforesaid decision of the Hon ble Karnataka High Court will not support the plea of assessee in the present case. The assessee in the present case except making a statement that cash payments were made on the last day of the month and cash payments were made keeping in view the business exigencies is not supported by any evidence as to whether the last day of the month is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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