Allowability of cash discount
This query is : Resolved
06 August 2011
An assessee having turnover around Rs. 13 crores has claimed Rs. 8 lakhs as Cash Discount in AY 2009-10. The amount of CD is deducted from the respective Invoices. There is no other documentary evidence supporting the said CD. The Assessing Officer has disallowed the entire amount of CD Rs. 8 lakhs during the Scrutiny, on the ground that the same cannot be cross verified. Now the matter is up with the CIT(A).
Pls provide any suitable case law or any favourable ground for the allowability of Cash Discount.
Pls provide any suitable case law or any favourable ground for the allowability of Cash Discount.
07 August 2011
Right now I am not having any case law.
The cash discount allowed is if real, then it can be explained with the help of other credit invoices and the time taken in receiving the payments from them. Further savings in interest payable can also be taken as a point.
The discounts can not be cross verified
signifies that you have not made available the copies of confirmations of your ledger account or contra confirmation Ledger Accounts from the debtors' Books.
Try to avail them. CIT(A) may consider the same.
The cash discount allowed is if real, then it can be explained with the help of other credit invoices and the time taken in receiving the payments from them. Further savings in interest payable can also be taken as a point.
The discounts can not be cross verified
signifies that you have not made available the copies of confirmations of your ledger account or contra confirmation Ledger Accounts from the debtors' Books.
Try to avail them. CIT(A) may consider the same.
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