What is the meaning of power in rule 6dd(f)

yes in my opinion sec 40A(3) & rule 6DD will be applied for every purchase in excess of Rs.20000/- from the same dealer or person. however some payment which are made on bank holidays or where the banking fecelities are not available in such cases the payment in excess of 20000/- may be allowable.

Mr. Mishra,

In furtherance to what Mr. Hiremath has suggested i would like to state a recent important judgment:

COMMISSIONER OF INCOME –TAX V. RAJA PAL AUTOMOBILES (2010) 320 ITR 185 (ALL), it has been held that if the assessee had fully explained the details of payment made in cash, that the entire evidence in the form of bill, cash memos, etc; had also been furnished by the assessee, that the payment had been made under unavoidable and exceptional circumstances and that the genuineness of the transactions and the identity of the persons to whom the payments were made had not been doubted, then it will be covered under rule 6DD. Further, the section has been held constitutionall valid in Attar Singh Gurmukh singh vs, ITO [1991] 191 ITR 667. The Application of sec-40A (3) is an anti-evasion section and it is not a draconain section. Hence, both the sections should be read together.

Further, one of the very imporatant factors i.e. "business expediency" should also be considered.