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Informative

KSEB is "State": ITAT Rules Cash Payments to Govt. utilities Fall u/s 40A(3) Exception, Deletes Disallowance

Update / Judgement Date

20 Aug 2025

Source

Taxscan

Author

Team — WCP Legal Desk

Reading Time

1 min read

Income TaxOther Legal Matters

The ITAT has ruled that "KSEB is a state" and that "cash payments to government utilities fall under the Section 40(a)(3) exception," deleting a disallowance. The tribunal's decision provides a significant victory for the company. The ruling clarifies that a payment that is made to a government body cannot be disallowed.