2020 (12) TMI 384

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....08/2019 for the Assessment Year 2009-10. 2. 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....

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....009 2 Seethalakshmi DalI Mill 223,590 11.09.2008 11.09.2008 3 Seethalakshmi Dali Mill 1 604,800 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 acc....

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....is sister concerns are not reflected in the balance sheet, therefore order passed by the Assessing Officer may be upheld. 6. On the other hand, ld. counsel for the assessee has strongly supported 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 ....