The ITAT allowed the assessee's appeal against disallowance...

The ITAT allowed the assessee's appeal against disallowance under Section 40A(3) for cash payment of Rs. 30 lakhs towards property purchase. It was held that the genuineness and bona fide nature of the transaction, including the cash payment, could not be doubted. The tribunal relied on precedent affirming that Section 40A(3) is not absolute and permits consideration of business expediency and relevant facts. The payment was made at the seller's insistence, constituting legitimate business expediency. Consequently, the cash payment did not violate Section 40A(3), and the disallowance was unwarranted in the circumstances.