Section 40(A)(3) of the Income Tax Act

Income-tax Act, 2025: s.35

Section 40(A)(3) falls under section 40 of the Income-tax Act, 1961, which corresponds to section 35 (Amounts not deductible in certain circumstances) of the Income-tax Act, 2025.

Read section 35 of the 2025 Act

Correspondence checked against the ICAI tabular mapping of the two Acts and the BharatTax.co section commentary.

The decision most relied on for Section 40(A)(3) is 159 Taxmann 392 CIT v. Gobind Ram (Punjab & Haryana) (ii) CIT vs. Gobind Ram (48 Taxmann.com 14), cited in 23 of the 52 judgments on BharatTax that turn on this section.

Leading authorities on Section 40(A)(3)

159 Taxmann 392 CIT v. Gobind Ram (Punjab & Haryana) (ii) CIT vs. Gobind Ram
48 Taxmann.com 14 · 2014 · High Court
23
citing judgments

An addition cannot be made under section 69C for unexplained expenditure if the on-money/unaccounted receipts have already been considered as revenue receipts, as this would constitute double addition.

386 (Allahabad) 5. CIT-II v. Hindustan Equipment (P) Ltd.
30 Taxmann.com 295 · 2013 · High Court
6
citing judgments
66 TTJ 508 (All) Smt. Usha Tripathi v. ACIT
72 ITD 155 · 2000 · ITAT
5
citing judgments

Judgments on Section 40(A)(3)

ITO 6 (1)(1), Mumbai vs. M/S A J Coal Pvt Ltd., Mumbai

In the result, both the appeals of the assessee and the In the result, both the appeals of the assessee and the In the result, both the appeals of the assessee and the Revenue are dismissed

ITA 5718/MUM/2019[2009-10]Status: DisposedITAT Mumbai10 Jul 2023AY 2009-10

Bench: Shri Om Prakash Kant () & Ms. Kavitha Rajagopal () Assessment Year: 2009-10 Ito-6(1)(1), M/S A.J. Coal Pvt. Ltd., Aayakar Bhavan, 24A, Coal Depot, Sewree (E), Vs. Room No. 503, 5Th Floor, M.K. Mumbai-400015. Road, New Marine Lines, Mumbai-400020. Pan No. Aabca 0386 M Appellant Respondent Assessment Year: 2009-10 M/S A.J. Coal Pvt. Ltd., Ito-6(1)(1), C/O M/S Jayesh Sanghrajka & Aayakar Bhavan, Room No. 503, Co. Llp, 405, Hind Rajasthan Vs. 5Th Floor, M.K. Road, New Marine Centre, Ds Phalke Road, Dadar Lines, Mumbai-400020. (East), Mumbai-400014. Pan No. Aabca 0386 M Appellant Respondent

For Appellant: Mr. Shubham Shah, ARFor Respondent: Ms. Indira Adakil, DR
Section 148Section 151

DCIT(E), Circle-1(1), New Delhi vs. Delhi & District Circket Association, New Delhi

In the result, the appeal of the revenue is dismissed

ITA 3058/DEL/2019[2015-16]Status: DisposedITAT Delhi09 Jun 2023AY 2015-16

Bench: Shri Chandra Mohan Garg & Shri M. Balaganeshassessment Year: 2015-16 The Dcit 1(1), Exemption, New Delhi M/S. Delhi & District Cricket Association 110002 Ferozshah Kotla Ground, Bahadur Shah Vs. Zafar Marg, New Delhi 110002 Pan Aaatd 0828 P (Appellant) (Respondent) For Revenue : Ms. Maimun Alam, Sr. Dr For Assessee : Shri Ved Jain, Adv. Shri Aman Garg, Ca Date Of Hearing : 25.04.2023 Date Of Pronouncement : 09.06.2023 Order Per Chandra Mohan Garg, J.M. This Appeal Has Been Filed Against The Order Of Cit(A)-40, New Delhi Dated 15.01.2019 For Ay 2015-16. 2. The Grounds Raised By The Revenue Are As Follows:- (I) On The Facts & In The Circumstances Of The Case & In Law, Ld Cit (A) Has Erred In Directing The Ao To Allow Exemption Us. 11 Of The Act Particularly When The Assessee Has Shown Receipts From Sponsorship Income, Sale Of Liquor, Income From Corporate Boxes & Sale Of Tickets Which Are Purely Commercial In Nature. (Ii) On The Facts & In Circumstances Of The Case & In Law, Id Cit (A) Has Erred In Treating Prior Period Expenses, Provisions For Gratuity & Leave Encashment As Consequential To Allowing Exemption To The Assessee Ignoring The Fact That Such Expenses Are Not Incurred During The Year & Cannot Be Treated As Application Of Income. (Iii) On The Facts & In Circumstances Of The Case & In Law, Ld Cit(A) Has Erred In Deleting The Addition Made U/S 40(A) (3) Of The Income Tax Act, Such Addition Being Consequential In Nature To Disallowance Of Benefit Of Exemption To The Assessee.

For Appellant: Shri Ved Jain, AdvFor Respondent: Ms. Maimun Alam, Sr. DR
Section 11Section 12ASection 40

M/S Paradise Multiplex Cum Villas. Pvt. Ltd, Abohar vs. Income Tax Officer Ward-II(3), Abohar

In the result, the appeals of assessee bearing ITA No

ITA 138/ASR/2019[2009-10]Status: DisposedITAT Amritsar28 Apr 2023AY 2009-10

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 143(3)Section 148Section 250(6)

M/S Paradies Multiplexs Cum Villas Pvt Ltd, Abhoar vs. Income Tax Officer Ward 2(3), Abohar

In the result, the appeals of assessee bearing ITA No

ITA 628/ASR/2018[2008-09]Status: DisposedITAT Amritsar28 Apr 2023AY 2008-09

Bench: Dr. M. L. Meena & Sh. Anikesh Banerjee

Section 143(3)Section 148Section 250(6)

Sadhna Media Pvt. Ltd., New Delhi vs. Pr.CIT Central Delhi-3, New Delhi

ITA 1115/DEL/2021[2017-18]Status: DisposedITAT Delhi23 Nov 2022AY 2017-18

Bench: Shri N.K.Billaiya & Shri Kul Bharat

Section 153ASection 153CSection 263Section 37Section 40Section 40A(3)

Sadhna Media Pvt. Ltd., New Delhi vs. Pr.CIT Central Delhi-3, New Delhi

ITA 1114/DEL/2021[2016-17]Status: DisposedITAT Delhi23 Nov 2022AY 2016-17

Bench: Shri N.K.Billaiya & Shri Kul Bharat

Section 153ASection 153CSection 263Section 37Section 40Section 40A(3)

Sadhna Media Pvt. Ltd., New Delhi vs. Pr.CIT Central Delhi-3, New Delhi

ITA 1113/DEL/2021[2015-16]Status: DisposedITAT Delhi23 Nov 2022AY 2015-16

Bench: Shri N.K.Billaiya & Shri Kul Bharat

Section 153ASection 153CSection 263Section 37Section 40Section 40A(3)

Sadhna Media Pvt. Ltd., New Delhi vs. Pr.CIT Central Delhi-3, New Delhi

ITA 1112/DEL/2021[2014-15]Status: DisposedITAT Delhi23 Nov 2022AY 2014-15

Bench: Shri N.K.Billaiya & Shri Kul Bharat

Section 153ASection 153CSection 263Section 37Section 40Section 40A(3)

ACIT, Mumbai vs. Jasmino Polymertech Pvt. Ltd., Mumbai

In the result, the appeal filed by the revenue is hereby dismissed

ITA 5738/MUM/2019[2010-11]Status: DisposedITAT Mumbai08 Mar 2022AY 2010-11

Bench: Shri Amarjit Singh, Jm & Amarjit Singh, Am आयकर अपील सं/ I.T.A. No. 5738/Mum/2019 (निर्धारण वर्ा / Assessment Year: 2010-11) Acit बिधम/ Jasmino Polymertech Pvt. 5Th Floor, Room No.506, Ltd. Vs. Aayakar Bhavan, M. K. L-61, Midc Industrial Area, Taloja, Raigad, Maharashtra- Road, Mumbai-400020. 410208. & Cross Objection No.41/Mum/2021 आयकर अपील सं/ I.T.A. No. 5738/Mum/2019 (निर्धारण वर्ा / Assessment Year: 2010-11) Jasmino Polymertech Pvt. बिधम/ Acit-6(3)(1) 5Th Floor, Room No.506, Ltd. Vs. L-61, Midc Industrial Area, Aayakar Bhavan, M. K. Taloja, Raigad, Maharashtra- Road, Mumbai-400020. 410208. स्थायी लेखा सं./जीआइआर सं./Pan/Gir No. : Aaacj5175G (अपीलाथी /Appellant) .. (प्रत्यथी / Respondent) Revenue By: Shri Ujjawal Kumar Assessee By: Shri Devendra Jain सुनवाई की तारीख / Date Of Hearing: 19/01/2022 घोषणा की तारीख /Date Of Pronouncement: 08/03/2022 आदेश / O R D E R Per Amarjit Singh, Jm: The Revenue As Well As Assessee Have Filed The Above Mentioned Appeal As Well As Cross-Objection Against The Order Dated 21.05.2019 Passed By The Commissioner Of Income Tax (Appeals)-12, Mumbai [Hereinafter Referred To As The “Cit(A)”] Relevant To The A.Y.2010-11. C.O. No.41/Mum/2021 A.Y.2010-11 2. The Revenue Has Raised The Following Grounds: -

For Appellant: Shri Devendra JainFor Respondent: Shri Ujjawal Kumar
Section 133(6)Section 143(1)Section 143(2)Section 147Section 40

ITO-6(1)(4), Mumbai vs. M/S. Biomed Healthcare P. Ltd., Mumbai

In the result, this appeal is dismissed

ITA 1484/MUM/2020[2011-12]Status: DisposedITAT Mumbai03 Nov 2021AY 2011-12
Section 143(3)Section 40

M/S Samrudhi Developers, Bangalore vs. The Assistant Commissioner of Income Tax Circle-6(2)(1), Bangalore

In the result appeal filed by assessee stands allowed

ITA 2272/BANG/2018[2013-14]Status: DisposedITAT Bangalore23 Jul 2021AY 2013-14

Bench: Shri. B. R. Baskaran & Smt. Beena Pillaiassessment Year : 2013 – 14

For Appellant: Shri V Srinivasan, AdvocateFor Respondent: Shri Kannan Narayanan, JCIT
Section 143(1)Section 143(2)Section 40

Sri. Venkataramanappa Ravikumar, Bangalore vs. Assistant Commissioner of Income Tax, Central Circle- 3(2)(1), Bangalore

In the result, the appeal filed by the assessee is partly allowed

ITA 2660/BANG/2019[2014-15]Status: DisposedITAT Bangalore14 Jul 2021AY 2014-15

Bench: Shri B. R. Baskaran & Smt. Beena Pillaiassessment Year: 2014-15

For Appellant: Shri V. Srinivasan, A.RFor Respondent: Shri Muzaffar Hussain, D.R
Section 133ASection 37(1)Section 40

ITO 24 (1)(5), Mumbai vs. Shri. Devdas Manjayya Sherugar, Mumbai

The appeal stands dismissed

ITA 6893/MUM/2019[2010-11]Status: DisposedITAT Mumbai01 Jun 2021AY 2010-11

Bench: Hon’Ble Shri Mahavir Singh, Vp & Hon’Ble Shri Manoj Kumar Aggarwal, Am (Hearing Through Video Conferencing Mode) आयकर अपील सं./ I.T.A. No.6893/Mum/2019 (िनधा"रण वष" / Assessment Year: 2010-11) Ito-24(1)(5) Shri Devdas Manjayya Sehrugar बनाम/ 607, Piramal Chambers Gala No.9, Ark Ind. Premises Csl Jeejeebhoy Lane, Lalbaug Makwana Road, Andheri East Vs. Mumbai – 400 012 Mumbai – 400 059 Pan No. : Aayps-4717-Q (अपीलाथ"/Appellant) (""थ" / Respondent) : Assessee By : None Revenue By : Shri Rajendra Joshi– Ld. Sr. Dr सुनवाई की तारीख/ : 25/05/2021 Date Of Hearing घोषणा की तारीख / : 01/06/2021 Date Of Pronouncement आदेश / O R D E R

For Appellant: NoneFor Respondent: Shri Rajendra Joshi– Ld. Sr. DR
Section 133(6)Section 143(1)Section 143(3)Section 40

Voice Line Tele Services, Hyderabad vs. Income Tax Officer, Ward-10(2), Hyderabad

In the result, the appeal of the assessee is treated as partly

ITA 723/HYD/2018[2014-15]Status: DisposedITAT Hyderabad11 May 2021AY 2014-15

Bench: Smt. P. Madhavi Devi(Through Virtual Hearing) M/S. Voice Line Tele Services, 1-11-749/A/1, G-1, Kochar Apartments, Begumpet, Hyderabad. Pan Aacfv 7461L ….Appellant.

For Appellant: Shri S. Shyam Sunder RaoFor Respondent: Shri A. Venkata Rao (D.R.)
Section 143(2)Section 143(3)Section 28Section 40Section 40A(3)Section 43B

Asst. CIT 6 (2)(1), Mumbai vs. M/S Chanvin Engineering Pvt Ltd., Mumbai

In the result, the Revenue’s appeal is dismissed

ITA 5695/MUM/2019[2010-11]Status: DisposedITAT Mumbai18 Mar 2021AY 2010-11

Bench: Shri Mahavir Singh & Shri S. Rifaur Rahmanasst. Cit-6(2)(1), M/S. Chanvim Engineering Pvt. Ltd. Room No. 504, Aaykar Bhavan, 3, Nanji Building, A. D. Marg, M. K. Road, Churchgate, Vs. Sewere, Mumbai – 400 012 Mumbai-400 020 Pan/Gir No. Aaacc 4729 P (Appellant) : (Respondent) Appellant By : Ms. Shreelala Pardeshi Respondent By : Shri M. Subramanian Date Of Hearing : 18.03.2021 : 18.03.2021 Date Of Pronouncement O R D E R Per Mahavir Singh, Vp: This Appeal By The Revenue Is Arising Out Of The Order Of The Commissioner Of Income Tax (Appeals)-12, Mumbai (‘Cit(A)’ For Short) In Appeal No. Cit(A)-12/Dcit- 6(2)(1)/B2-286/16-17 Vide Order Dated 20.05.2019. The Assessment Was Framed By The Dcit, Circle-6(2)(1), Mumbai U/S. 143(3) R.W.S 147 Of The Income Tax Act, 1961 (‘The Act’ Hereinafter) For The Assessment Year (A.Y.) 2010-11 Vide His Order Dated 30.03.2016. 2. The Only Issue In This Appeal Of Revenue Is As Regards To The Order Of The Ld. Cit(A), Deleting The Addition Made By The Assessing Officer (‘A.O.’ For Short) In Regard To Bogus Purchases Amounting To Rs.2,36,250/-. The Revenue Has Raised The Issue Of Applicability Of Provisions Of Section 40(A)(3) Of The Act Also.

For Appellant: Ms. Shreelala PardeshiFor Respondent: Shri M. Subramanian
Section 143(3)Section 40

The Commissioner of Income Tax vs. M/S Asea Brown Boveri Ltd

ITA/420/2012HC Karnataka24 Jun 2020

Bench: ALOK ARADHE,M.NAGAPRASANNA

Section 143(1)Section 201Section 201(1)Section 260Section 260ASection 40Section 43BSection 80H

DCIT 6 (2)(1), Mumbai vs. M/S Della Technica Interior Design Pvt. Ltd, Mumbai

In the result, appeal filed by the Revenue is dismissed

ITA 1217/MUM/2019[2010-11]Status: DisposedITAT Mumbai22 Jun 2020AY 2010-11

Bench: Hon’Ble Shri Mahavir Singh & Hon’ Ble Shri G. Manjunathadcit-6(2)(1) Vs. M/S Della Technica Interior Room No.504 Design Pvt.Ltd Aaykar Bhawan Rati Villa, Ground Floor M.K.Road Motibal Street Mumbai-400 020 Opp. Bhatia Hospital Tardeo, Sion(W) Mumbai-400 007 Pan/Gir No.Aabcd2765K (Appellant) .. Respondent) Assessee By Shri Forum Mehta, Ar Revenue By Ms. Samatha Mullamudi, Cit-Dr

Section 143(3)Section 147Section 40

ITO 6(1)(3), Mumbai vs. Auto Sales Pvt. Ltd., Mumbai

In the result, appeal filed by the revenue is dismissed

ITA 7107/MUM/2018[2011-12]Status: DisposedITAT Mumbai13 Mar 2020AY 2011-12

Bench: Shri Vikas Awasthy & Shri G. Manjunathaita No.7107 & 7108/Mum/2018 (Assessment Years: 2010-11 & 2011-12) Ito-6(1)(3) Vs. Auto Sales Pvt.Ltd. Room No.508, 5Th Floor 63/69, 3Rd Floor Aaykar Bhawan Nagdevi Cross Road M.K.Road Mumbai-400 003 Mumbai-400 020 Pan/Gir No.Aacca0108J (Appellant) .. Respondent)

Section 143(1)Section 143(3)Section 147Section 40

Shankar Engineering & Fabricators, Hyderabad vs. Income-Tax Officer, Ward-11(1), Hyderabad

In the result, the appeal of assessee is partly allowed for statistical purposes

ITA 442/HYD/2012[2007-08]Status: DisposedITAT Hyderabad23 Dec 2019AY 2007-08

Bench: Smt. P. Madhavi Devi & Shri A. Mohan Alankamony

For Appellant: Shri S. Rama Rao, ARFor Respondent: Shri Mookambikeyan S. DR
Section 143(3)Section 194CSection 234BSection 234CSection 40

Dr. Hitesh A. Patel, Himatnagar vs. The Income Tax Officer, S.K.Ward-3, Himatnagar

In the result, assessee’s appeal is partly allowed

ITA 528/AHD/2015[2010-11]Status: DisposedITAT Ahmedabad04 Apr 2019AY 2010-11

Bench: Shri Pramod Kumar, Hon’Ble&Smt. Madhumita Royआयकरअपीलसं.Ita No. 528/Ahd/2015 "नधा"रणवष"/Asstt. Year: 2010-11 Dr. Hitesh A. Patel Vs. Ito C/O. Harsh Hospital S.K. Ward-3 Umiya Complex, Himatnagar(S.K.) Nr. Mehta Petrol Pump Himatnagar, (S.K.)- 383001 Pan:Abe Pp1 040 J अपीलाथ"/ (Appellant) "त् यथ"/ (Respondent)

For Appellant: ShriS. N. Divatia, ARFor Respondent: ShriS. K. De
Section 133ASection 142(1)Section 143(2)Section 143(3)Section 40