TaxTMI 
TaxTMI 
2019 (7) TMI 752
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....g question as the substantial question of law in its memorandum of the Tax Appeal : "Whether the Appellate Tribunal has erred in law and on facts in confirming the decision of CIT(A) deleting the disallowance of Rs. 2,86,20,701/- made by the Assessing Officer under section 40A(3) of the Act?" 3. The Tribunal recorded the following findings as regards the proposed question : "4. Dissatisfied with the addition, assessee carried the matter in appeal before the CIT(A). It raised two fold of contentions. In the first fold of contention, on the strength of Hon'ble Gujarat High Court decision in the case of Principal Commissioner of Income Tax vs. Saumya Construction P.Ltd. reported in 387 ITR 529, it was contended that income u/s. 153A of....
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....has been contended that not only was the addition not sustainable since no payment in a single day exceeded Rs. 20,000/-, but also because the same was a business expediency since the land sellers did not have bank accounts. It has also been stated that the assessment completed u/s 143(3) rws 153A was legally invalid. 6.1 A careful perusal of the various case laws relied upon by the appellant shows that it has been clearly held by various courts, including the jurisdictional High Court in the case of Saumya Construction cited supra, that additions can be made u/s 153A only in those cases where during the course of search, incriminating documents or books of accounts have been found and seized and has to be based on such evidences and doc....
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....s as under :- "(3) Where the assessee incurs any expenditure in respect of which a payment or aggregate of payments made to a person in day otherwise that by a account payee cheque drawn on a bank or account payee bank draft exceeds twenty thousand rupees no deduction shall be allowed in respect of such expenditure." 6. A perusal of the above clause would indicate that disallowance out of expenditure could be made if payment or aggregate of payments made to a person in a day exceeds twenty thousand rupees. Ld. first appellate authority has examined this aspect and recorded a categorical finding of fact that payments made by the assessee on a single day did not exceed twenty thousand rupees to a person, if that be so, then how disallow....