2019 (4) TMI 2130

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....out of the order u/s 143(3) of the Income Tax Act 1961(In short the 'Act') dated 14.03.2013 framed by DCIT-1(1), Bhopal. 2. Assessee has raised following grounds of appeal; 1. That, the Learned CIT(Appeals) has erred in law and on facts in confirming the addition of Rs. 5,40,000/- to the total income of the appellant u/s 40A(3) of the Income Tax Act, 1961. 2. That, the Learned CIT(Appeals) has erred in law and on facts in confirming the addition, ignoring the fact that the payment was made by the appellant in cash, due to exceptional circumstances, as the recipient refused to accept the cheque payment, and the genuineness of the transaction is undisputed. 3. That amount of Rs. 5,40,000/- paid to one of the sell....

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....corded by the Id. AO as per the assessment order, the submission made by the appellant, the position of the law and the facts of the case on record. The ld. AO disallowed a sum of Rs. 5,40,000/- u/s 40A(3) of the Act being cash payment made to a seller of the land, namely Smt. Anari Bai. The appellant has contented that initially the seller had refused to accept payment by cash. However, the appellant has failed to substantiate the aforesaid contention with any documentary evidence. It is seen that not only this but payment by cheque were also made to the said seller. Hence, the argument of her refusal to accept cheque is not tenable. The Id. AR further argued that the land i~ a part of the stock in trade of the year; consequently it d....

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....ce of Rs. 5,40,000/- u/s 40A(3) of the Act. We observe that the assessee is into the business of purchase and sale of land and civil construction business. It purchased land from Smt. Anar Bai for a total consideration of Rs. 36,00,000/-. Out of the total purchase consideration of Rs. 36,00,000/- assessee paid cash of Rs. 6,20,000/- (verifiable from the Registered sale deed as well as affidavit placed in the paper book). Out of the cash payment of Rs. 6,20,000/- Ld. A.O has disputed only sum of Rs. 5,40,000/- which in view of Ld. A.O was payment for expenditure in cash exceeding Rs. 20,000/-. The total transaction of purchase of land for Rs. 36,00,000/- is not disputed and the complete details of considera....