Allowing the appeal of the assessee the Tribunal held that ,no disallowance can be made for cash payments if the transaction is genuine and the identity of the payee is known. Rule 6DD is not exhaustive. The fact that the transaction does not fall with Rule 6DD does not mean that a disallowance has to be per force made. (ITA No.1065/JP/2016, dt. 15.05.2018)(AY. 2013-14)
A Daga Royal Arts v. ITO ( 2018) 196 TTJ 541 /64 ITR 55 (SN)(Jaipur)(Trib) , www.itatonline.org
S. 40A(3) :Expenses or payments not deductible – Cash payments exceeding prescribed limits – No disallowance can be made for cash payments if the transaction is genuine and the identity of the payee is known. Rule 6DD is not exhaustive. The fact that the transaction does not fall with Rule 6DD does not mean that a disallowance has to be per force made. [ R.6DD ]