TaxTMI 
TaxTMI 
2020 (12) TMI 384
X X X X Extracts X X X X
X X X X Extracts X X X X
..... The Revenue has raised the following grounds of appeal:- "1) The order of the ld. CIT(A)-1, Visakhapatnam is erroneous both on facts and in law. 2) The ld. CIT(A) has erred in holding that since the assessee has not incurred expenditure and hence the provisions of sec.40A(3) can‟t be invoked in this case, when the AO noted that the assessee has made entries of these transactions in its books as ["payment‟ in cash and the assessee has not substantiated the nature of these transactions as against the findings of the AO in the assessment order. 3) The appellant craves leave to add or delete or amend or substitute any ground of appeal before and/or at the time of hearing of appeal. Besides the merit in facts and in law, it....
X X X X Extracts X X X X
X X X X Extracts X X X X
....0 20.12.2008 1 20.12.2008 6. Regarding other payments to M/s.Ravi Krishna Traders and M/s.Subrahmanyeswara Traders, the assessee stated that there are no expenditure entries, it is only inter-firm transactions between the two concerns and hence Section 40A(3) is not applicable. The assessee also furnished ledger copies of the following parties in the books of M/s.Sri Vigneswara Enterprises - (I) Ravi Krishna Traders (ii) Subrahmanyeswara Traders along with ledger copy of M/s.Sri Vigneswara Traders account in the above mentioned two parties books of accounts. 7. The assessee's contention is not acceptable as the entries were shown in the ledgers relating to purchase, sale and their respective payments are reflected in the Trading, ....
X X X X Extracts X X X X
X X X X Extracts X X X X
....upported the order passed by the ld. CIT(A). 7. We have heard both the sides, perused the material available on record and orders of the authorities below. 8. In this case, the assessee has made cash payments to M/s.Ravi Krishna Traders of Rs. 13,82,189/- and M/s.Subrahmanyeswara Traders of Rs. 14,08,652/-, both are sister concerns to the assessee. The case of the assessee is that there are no purchases from the sister concerns, therefore section 40A(3) has no application. The case of the Assessing Officer is that the payments made by the assessee to the above two sister concerns are relate to purchases, therefore section 40A(3) applies. The ld. CIT(A) has examined the copies of the ledgers of both the concerns i.e. M/s. Ravi Krishna Tra....