2018 (12) TMI 1663

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....) 2011-12.      2. The Revenue has taken five grounds of appeal, but its grievances revolve around two issues, namely:  (a) The determination of income u/s.153A of the Income Tax Act, 1961 (hereinafter referred to as "the Act") requires to be made without any restriction i.e. without the assistance of any seized material.   (b) The CIT(A) has erred in deleting the disallowance of Rs. 2,86,20,701/- which was disallowed by the Assessing Officer with the aid of section 40A(3) of the Act.    3. The brief facts of the case are that a search u/s.132 of the Act was carried out in the group cases of Master Group on 03/01/2013.  The assessee was also covered under the search action....

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....ontemplates that where the assessee incurs any expenditure in respect of which a payment or aggregate of payments made to a person in a day otherwise that by  an 'A/c.payee cheque' drawn on a bank or an 'A/c. payee bank draft' exceeds twenty thousand rupees, no deductions shall be allowed in respect of such expenditure.  It was pointed out that payment should not exceed Rs. 20,000/- in a day.  The assessee has not paid anyone more than Rs. 20,000/- in a day, therefore no disallowance could be made.  Learned first appellate authority has accepted both the contentions and deleted the addition.    It is worth to note the finding recorded by the Ld.CIT(A) which reads as under:      ....

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....been made by the A.O to seized documents or material while making the impugned addition.   6.1.2 Notwithstanding the above, even on merits, it is seen from the submissions made by the appellant during appellate proceedings that none of the payments in cash on a single day exceeded the limit of Rs. 20,000/-. In fact, even the A.O has noted this fact in his order. Further, it is seen that the total payment for purchase of land during the year under consideration by the appellant, is Rs. 13,43,40,451/-, out of which Rs. 2,86,20,701/- has been made in cash. Thus, the appellant's argument that the cash payments were made out of business expediency in some cases, stands to reason. The appellant's case is also covered by the ....