Rent paid in cash can’t be allowed as business expenses without details
Shri Santilal B. Parekh vs. ITAT Mumbai
case no. –
4262/mum/2017 date -4.02.2019
Fact of the Case
- In the present case the assessee is a person who is engaged in business.
- The assessee claimed deduction of Rs.54000 p.m as rent expenses of his business. But the A.O denied to allow the deduction.
- The assessee then appealed to the ITAT against the decision of A.O
Decision of the Case
The Income Tax Appellate Tribunal observed the
followings:-
- The assess paid rent in cash.
- The rent paid in cash of Rs.54000 p.m without any proper supporting document in respect of rent payment i.e no lease rent agreement.
- Even there is no proper evidence that the premise has been used wholly for the running of the said business.
- Only the assessee has submitted selfsupporting vouchers with respect to the payment of rent in cash.
- Under this situation, the amount of rent paid in cash cannot be allowed as business expenses.