ACIT, CHENNAI V. Shri K.M.Vidyasagar, CHENNAI

ITA 1339/CHNY/2011

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 73795 (ITAT-CHENNAI)
• Duration Of Justice: 2 year(s) 8 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 21-03-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: A
• Next Hearing Date: 26-02-2014
• Assessment Year: 2006-2007
• Appeal Filed On: 21-07-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S SRIDHAR
• Keywords: Income from undisclosed sources; Competent authority; Commercial expediency
• Section: 40A(3); 143(3)

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL , A BENCH, CHENNAI . , ! ' , # $ BEFORE SHRI A.MOHAN ALANKAMONY ACCOUNTANT MEMBER AND SHRI CHALLA NAGENDRA PRASAD, JUDICIAL MEMBER I.T.A.NOS. 1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 (IN ITA NO.1340/MDS/2011) ( / ASSESSMENT YEARS : 2006-07 & 2007-08) ASSISTANT COMMISSIONER OF INCOME TAX, CIRCLE-V, ANNEXE BUILDING, 6 TH FLOOR, 121, M.G.ROAD, CHENNAI-34. VS. MR. K.M. VIDYASAGAR, FLAT NO.8, 2 ND FLOOR, SAPTHASWARA 57, 1 ST AVENUE, ASHOK NAGAR CHENNAI-600 083. PAN:AADPV3326K ( /APPELLANT) (RESPONDENT/CROSS OBJECTOR) / APPELLANT BY : MR. SHAJI P.JACOB, ADDL.CIT /RESPONDENT BY : MR. S.SRIDHAR, ADVOCATE / DATE OF HEARING : 26 TH FEBRUARY, 2014 /DATE OF PRONOUNCEMENT : 21 ST MARCH, 2014 % / O R D E R PER CHALLA NAGENDRA PRASAD, JM: THESE APPEALS ARE FILED BY THE REVENUE AGAINST DIFFERENT ORDERS OF THE COMMISSIONER OF INCOME TAX (APPEALS)-VIII, CHENNAI DATED 29.04.2011 FOR THE AS SESSMENT YEARS 2006-07 AND 2007-08. THE CROSS OBJECTION IS F ILED BY THE ASSESSEE AGAINST THE SAID ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) DATED 29.04.2011 FOR THE ASSES SMENT ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 2 YEAR 2007-08. THE ONLY GRIEVANCE IN BOTH THE APPEAL S OF THE REVENUE IS THAT COMMISSIONER OF INCOME TAX (APPEALS ) ERRED IN DELETING DISALLOWANCE MADE UNDER SECTION 40A(3) OF THE ACT. 2. THE ASSESSING OFFICER WHILE COMPLETING ASSESSMEN TS FOR THESE TWO ASSESSMENT YEARS UNDER SECTION 143(3) DISALLOWED ` 14,16,253/- AND ` 27,05,911/- BEING CASH PAYMENTS MADE BY THE ASSESSEE IN VIOLATION OF PROVI SIONS OF SECTION 40A(3) OF THE ACT IGNORING THE SUBMISSION O F THE ASSESSEE THAT THESE CASH PAYMENTS WERE MADE BY THE ASSESSEE IN THE COURSE OF HIS BUSINESS OF MARKETING AGENCY FOR PURCHASE AND SALE OF PLOTS AND FLATS. THE NATU RE OF BUSINESS OF THE ASSESSEE NECESSITATED HIM TO MAKE P AYMENTS IN CASH AS THE LAND OWNERS INSISTED FOR CASH AND NO T BELIEVED IN CHEQUES AND WAIT FOR ITS ENCASHMENT. THE ASSESSE E ON HIS PART SHOULD ALSO GET PROFIT REGISTERED IMMEDIATELY AS THE COMPETITORS WOULD SNATCH AWAY THE PROPERTY MEANT FO R SALE. THEREFORE, ASSESSEE SUBMITTED THAT IN VIEW OF THE B USINESS EXPEDIENCY CASH PAYMENTS AS WELL AS CHEQUES WERE AL SO ISSUED IN THE COURSE OF HIS BUSINESS, PROVISIONS OF SECTION ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 3 40A(3) ARE NOT ATTRACTED. ON APPEAL, COMMISSIONER OF INCOME TAX (APPEALS) ANALYZING THE SUBMISSIONS OF T HE ASSESSEE AND PROVISIONS OF SECTION 40A(3) AND THE D ECISIONS RELIED ON DELETED THE DISALLOWANCE, AGAINST WHICH T HE REVENUE IS IN APPEAL BEFORE US FOR BOTH THE ASSESS MENT YEARS. 3. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT THERE I S NO BUSINESS EXPEDIENCY IN PAYING AMOUNTS IN CASH. DEPARTMENTAL REPRESENTATIVE SUBMITS THAT SOME OF TH E PAYEES HAVE BANK ACCOUNTS AND THE ASSESSEE HAS IN F ACT ISSUED CHEQUES TO SOME OF THE PAYEES AND THE PAYMEN TS MADE BY THE ASSESSEE WILL NOT FALL UNDER ANY EXCEPT IONS PROVIDED UNDER RULE 6DD(J). DEPARTMENTAL REPRESENT ATIVE REFERRING TO PAGE 4 OF THE ASSESSMENT ORDER SUBMITS THAT SOME OF THE PAYEES ARE RESIDING IN CHENNAI AND BANG ALORE AND THEY ARE ALL HAVING BANK ACCOUNTS AND THERE WAS NO NECESSITY FOR MAKING PAYMENTS IN CASH FOR THEM. 4. COUNSEL FOR THE ASSESSEE STRONGLY RELIED ON THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND REFERR ING TO ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 4 PROVISO TO SECTION 40A(3) HE SUBMITS THAT PROVISION S OF SECTION 40A(3) HAVE NO APPLICATION IN CASE PAYMENTS WERE MA DE IN THE COURSE OF BUSINESS FOR BUSINESS EXPEDIENCY AND WHERE THE TRANSACTIONS ARE GENUINE. HE SUBMITS THAT HIS C ASE FALLS UNDER LAST LIMB OF THE PROVISO TO SECTION 40A(3) I .E. CONSIDERATION OF BUSINESS EXPEDIENCY AND OTHER REL EVANT FACTORS. REFERRING TO THE JUDGEMENT OF HONBLE GUJA RAT HIGH COURT IN THE CASE OF ANUPAM TELE SERVICES VS. ITO IN TAX APPEAL NO.556 OF 2013 DATED 22.01.2014, THE COUNSE L SUBMITS THAT PROVISIONS UNDER RULE 6DD(J) ARE NOT E XHAUSTIVE. HE FURTHER SUBMITS THAT CONSIDERATION OF BUSINESS E XPEDIENCY AND OTHER RELEVANT FACTORS ARE NOT EXCLUDED WHILE A PPLYING THE PROVISIONS OF SECTION 40A(3) OF THE ACT. HE ALSO PL ACED RELIANCE ON THE DECISION OF THE CO-ORDINATE BENCH O F THIS TRIBUNAL IN THE CASE OF M/S. TRIDENT MOVIES VS. ACI T IN ITA NO.184/MDS/2012 DATED 17.01.2013 IN SUPPORT OF HIS SUBMISSION THAT CONSIDERATIONS OF BUSINESS EXPEDIEN CY ARE RELEVANT FACTORS TO BE CONSIDERED FOR NOT MAKING DI SALLOWANCE UNDER SECTION 40A(3) OF THE ACT. ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 5 5. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHOR ITIES AND DECISIONS RELIED ON. THE ASSESSING OFFICER DISA LLOWED CASH PAYMENTS MADE BY THE ASSESSEE UNDER SECTION 40 A(3) OF THE ACT. THERE IS NO DISPUTE THAT ALL THESE TRAN SACTIONS ARE MADE IN THE COURSE OF ASSESSEES BUSINESS OF PURCH ASE AND SALE OF PLOTS AND THE TRANSACTIONS ARE ALL GENUINE. THE QUESTION NOW FOR CONSIDERATION IS WHETHER ASSESSEE MADE THESE PAYMENTS IN THE COURSE OF CARRYING ON THE BUS INESS OF PURCHASE AND SALE OF PLOTS AND CONSIDERATIONS OF BU SINESS EXPEDIENCY AND OTHER RELEVANT FACTORS ARE RELEVANT FOR THE PURPOSE OF SECTION 40A(3) OR NOT? 6. THE HONBLE GUJARAT HIGH COURT IN THE CASE OF AN UPAM TELE SERVICES (SUPRA) HELD THAT PROVISIONS OF RULE 6DD(J) ARE NOT EXHAUSTIVE AND CONSIDERATIONS OF BUSINESS EXPED IENCY AND OTHER RELEVANT FACTORS ARE NOT EXCLUDED FROM TH E PROVISIONS OF SECTION 40A(3) OF THE ACT. THIS IS AL SO CLEAR ON READING FROM THE PROVISIONS OF SECTION 40A(3) OF T HE ACT. THE COMMISSIONER OF INCOME TAX (APPEALS) ELABORATELY CONSIDERED THE SUBMISSIONS OF THE ASSESSEE AS WELL AS CASE ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 6 LAWS AND CAME TO THE CONCLUSION THAT PROVISIONS OF SECTION 40A(3) ARE NOT ATTRACTED IN THE ASSESSEES CASE OBS ERVING AS UNDER:- 5 . THE MAIN ISSUE FOR RENDERING DECISION IN THIS APPEAL IS WITH REFERENCE TO THE APPLICABILITY OF TH E PROVISIONS OF SECTION 40A(3) OF THE ACT TO THE FACT S OF THE CASE AND ACCORDING T O THE APPELLANT THE SAID PROVISIONS OF THE ACT ARE WRONGLY APPLIED INASMUCH AS THE NATURE OF THE BUSINESS OF THE APPELLANT NECESSITATED HIM TO MAKE PAYMENTS IN CASH FOR PURCHASE OF LANDS AS LAND OWNERS DID NOT BELIEVE IN RECEIVING CHEQUES AND WAIT FOR ITS ENCASHMENT. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, IT WAS SUBMITTED THAT THE APPELLANT ON HIS PART SHOULD ALSO GET THE PROFIT REGISTERED IMMEDIATELY AS THE COMPETITORS WOULD SNATCH AWAY THE PROPERTY MEANT FOR SALE. THEREFORE, IT WAS PLEADED BEFORE THE ASSESSING OFFICER THAT CONSIDERING THE BUSINESS CARRIED ON BY THE APPELLANT BEING A MARKETING AGENT FOR PLOTS AND FLATS IN DERIVING BROKERAGE INCOME THE EXCEPTIONAL COMMERCIAL EXPEDIENCY WOULD JUSTIFY HIS PRAYER FOR NOT APPLYING THE PROVISIONS OF SECTION 40A(3) OF THE ACT. 6. IN SO FAR AS THE PAYMENT BEING THE SALE CONSIDERATION FOR THE TRANSACTION OF PURCHASE OF PROPERTY IN HARRINGTON NAGAR, THE ASSESSING OFFICER HAS ERRONEOUSLY APPLIED THE PROVISIONS OF SECTION 40A(3) OF THE ACT TO MAKE THE DISALLOWANCE OF ` 4O,OOO/- BEING 20% OF RS.2,OO,OOO/- PAID TO MRS. DEVI MOHAN INASMUCH AS THE TRANSACTION OF CASH PAYMENT TOWARDS SALE CONSIDERATION WAS EFFECTED ON 12.9.2005 BEING THE BEGINNING OF THE WEEK, MONDAY AND CONSEQUENT TO THE COMMERCIAL EXPEDIENCY THE PAYMENT OF RS.2,OO,OOO/- BEING THE SALE CONSIDERATION WAS MADE TO THE SELLER OF THE PROPERT Y. ACCORDING TO THE APPELLANT, THE SALE CONSIDERATION PAID FOR THE PURCHASE OF PROPERTY UNDER CONSIDERATI ON WOULD BE OUTSIDE THE PURVIEW OF THE PROVISIONS OF SECTION 40A(3) OF THE ACT AND ON THE TOUCHSTONE OF PURPOSIVE THEORY, IT IS SUBMITTED THAT HAVING ACCEP TED ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 7 THE PURCHASE OF LAND IN THE IDENTIFICATION OF THE S ELLER OF THE PROPERTY AS WELL AS THE IDENTIFICATION OF TH E TRANSACTION OF PURCHASE OF LAND IN THE HANDS OF REA L ESTATE OPERATOR/THE APPELLANT HEREIN, THE PROVISION S OF SECTION 40A(3) OF THE ACT ARE ERRONEOUSLY APPLIE D. 7. IN THE DECISION RENDERED BY THE GAHUWATI HIGH COURT IN THE CASE REPORTED IN 240 ITR 902, IT WAS H ELD AS FOLLOWS: 'FROM A PERUSAL OF THE DECISIONS OF DIFFERENT HIGH COURTS REFERRED TO ABOVE, IT CLEARLY EMERGES THAT THE PURPOSE OF SECTION 40A(3) OF THE ACT IS NOT TO PENALIZE THE ASSESSEE FOR MAKING CASH PAYMENT OF AN AMOUNT OF RS2,5OO/- OR ABOVE. THE PURPOSE IS ONLY TO PREVENTIVE AND TO CHECK EVASION OF TAX AND FLOW OF UNACCOUNTED MONEY OR TO CHECK TRANSACTION WHICH ARE NOT GENUINE AND MAY BE PUT AS CAMOUFLAGE TO EVADE TAX BY SHOWING FICTITIOUS OR FALSE TRANSACTIONS' 8. THE APPELLATE TRIBUNAL IN THE CASE REPORTED IN 93 TT] 912 HAS HELD AFTER CONSIDERING THE DECISION OF THE APEX COURT REPORTED IN 191 ITR 667 AS FOLLOWS:- 'THE HON'BLE SUPREME COURT NOTED THAT THE INTENTION TO MAKE PAYMENT BY CROSSED CHEQUE OR CROSSED DD IS TO ENABLE THE ASSESSING AUTHORITY TO ASCERTAIN THAT THE PAYMENT IS GENUINE AND NOT OUT OF THE UNDISCLOSED SOURCE. IT IS ALSO NOTED THAT SECTION 40A(3) OF THE ACT IS INTENDED TO REGULATE BUSINESS TRANSACTIONS AND TO PREVENT THE USE OF UNACCOUNTED MONIES OR TO REDUCE THE CHANCES OF USE OF BLACK MONEY FOR BUSINESS TRANSACTIONS. IN THE PRESENT CASE, IT IS SEEN THAT THE ASSESSEE FOR PURCHASE OF RICE, PAID THE AMOUNT DIRECTLY TO THE BANK ACCOUNT OF THE PAYEE. THE EFFECT OF ISSUE OF CROSSED CHEQUE/DD IS THAT THE PAYEE NAMED THEREIN RECEIVES THE PAYMENT THROUGH BANKING CHANNELS. THE PURPOSE IS DUAL. IN THE FIRST INSTANCE, IT IS TO SEE THAT PAYEE AND PAYEE ALONE RECEIVES THE PAYMENT AND TO ENSURE THAT THE PAYMENT IS ROUTED THROUGH ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 8 BANK CHANNEL SO AS TO TRACE THE ORIGIN AND CONCLUSION OF THE TRANSACTION. IN THE CASE BEFORE US, IT IS SEEN THAT INSTEAD OF ISSUING CHEQUE/DD, THE ASSESSEE PREPARED A CHALLAN AND ALONG WITH THE CASH THE CHALLAN WAS PRESENTED TO THE BANK OF THE PAYEE FOR THE CREDIT OF THE SAME IN THE ACCOUNT OF PAYEE. IN THE RESULT, IT IS ENSURED THAT THE PAYEE AND PAYEE ALONE RECEIVES THE PAYMENT AND THE ORIGIN AND CONCLUSION OF TRANSACTION IS TRACEABLE. THUS, PAYMENT OF SUM DIRECTLY IN THE BANK ACCOUNT OF PAYEE FULFILS THE CRITERIA FOR ENSURING THE OBJECT OF INTRODUCTION OF SECTION 40A(3). THIS IS NOT A DIRECT PAYMENT TO THE PAYEE BUT ONLY TO THE CREDIT OF ITS BANK ACCOUNT WITHOUT THE PAYEE ACTUALLY RECEIVING THE CASH . WE ACCORDINGLY HOLD THAT SUCH PAYMENT IS NOT IN VIOLATION OF PROVISION OF SECTION 40A(3) AND HENCE NO DISALLOWANCE IS CALLED FOR.' 9 . IN THE CASE REPO R TED IN 274 ITR 534 THE GUJARAT HIGH COURT AS DISCUSSED THE ISSUE UNDER CONSIDERATION ESPECIALLY WHERE THE PRACTICALITY OF THE PAYMENT, SHOULD BE JUDGED FROM THE VIEW OF BUSINESSMEN AND NOT THE ASSESSING OFFICER IN FOLLOWING WORDS: 'HELD THAT SECTION 40A(3) WAS INTENDED TO SERVE THE OBJECTIVE OF CHECKING TAX EVASION AND ENSURE THAT PAYMENTS EXCEEDING RS.2,500/- ARE MADE BY CROSSED CHEQUE OR BANK DRAFT SO THAT IT WILL BE EASIER TO ASCERTAIN, WHEN DEDUCTION IS CLAIMED, WHETHER THE PAYMENT WAS GENUINE AND WHETHER IT WAS MADE OUT OF INCOME FROM DISCLOSED SOURCES. THE SECTION IS MANDATORY AND THERE IS NO DISCRETION LEFT WITH THE TAXING AUTHORITY UNDER THIS SUB-SECTION TO ALLOW EXPENDITURE WHICH DOES NOT COMPLY WITH IT. THE RIGOUR OF THE RULE CONTAINED IN THIS SUB-SECTION IS, HOWEVER, RELAXED TO SOME ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 9 EXTENT BY THE SECOND PROVISO TO THE SAID SUB-SECTION SHALL BE MADE WHERE ANY SUCH PAYMENT IS MADE OTHERWISE THAN BY A CROSSED CHEQUE OR A CROSSED BANK DRAFT, IN SUCH CASES AND UNDER SUCH CIRCUMSTANCES AS MAY BE PRESCRIBED, HAVING REGARD TO THE NATURE AND EXTENT OF BANKING FACILITIES AVAILABLE, CONSIDERATIONS OF BUSINESS EXPEDIENCY AND OTHER RELEVANT FACTORS. THOSE GUIDELINES WILL HAVE TO BE BORNE IN MIND WHILE INTERPRETING THE PROVISIONS OF THE RELEVANT RULES ENACTED BY THE COMPETENT AUTHORITY, SO THAT BY A CONSTRICTED OR ARTIFICIAL CONSTRUCTION OF THOSE RULES, THE VERY OBJECT OF THE LEGISLATURE IS NOT FRUSTRATED.' THE PROVISIONS OF SECTION 40A(3) OF THE ACT ARE NOT ABSOLUTE I N ITS TERM AND ACCORDINGLY WHERE THERE IS A FINDING THAT THE SEL L ER HAS INS I STED ON CASH PAYMENT AND THE PAYMENT IS GENUINE, THEN THE AMOUNT COULD NOT BE D I SALLOWED ON TECHNICAL GROUNDS. THE ABOVE VIEW IS FOR TI FIED AND TAKEN BY THE ALLAHABAD H I GH COURT I N THE CASE REPORTED IN 217 ITR 43 1 . 1 0. THE CALCUTTA H I GH COURT HAS HELD IN THE CASE REPORTED IN 247 ITR PAGE 13 THAT A PAYMENTS I N CASH REFLECTED IN BOOKS OF ACCOUN T S CANNOT BE DISALLOWED INVOK I NG SECTION 40A(3) OF THE ACT . 11 . SIMILARLY, THE DECISION REPORTED IN 251 ITR 640 AND ANOTHER DECISION REPORTED IN 250 ITR 738 HAVE REITERATED THAT LIBERAL VIEW SHOULD BE TAKEN IN THE CONSIDERATION OF RULE 6DD(J) WHERE THERE ARE COMPELLING OR MITIGATING CIRCUMSTANCES. 12. THE MEANING OF THE WORD PRACTICABLE IN THE ORDINARY PARLANCE MUST PREVAIL IN THE CONTEXT OF RU LE 6DD(J) AND IN THE OBJECT OF THE ENACTMENT NAMELY, TO RELAX THE RIGOUR OF SECTION 40A(3) OF THE ACT IN GENUINE AND BONAFIDE CASES TO AVOID HARDSHIP AND HARASSMENT IS BORNE IN MIND AND ACCORDING TO THE WORD 'PRACTICABLE' UNDER THE PRESENT SCENARIO MUST SIGNIFY WIDER SCOPE SO AS TO CAPABLE OF BEING PUT I NTO PRACTICE, DONE OR ACCOMPLISHED IN THE AVAILABLE ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 10 MEANS AND RESOURCES. 13. IF WE ANALYSIS THE CRUX OF THE SECOND PROVISO T O SECTION 40A(3), THERE ARE THREE FACTORS (SHOWN IN BRACKETS AS (1), (2) AND (3) HEREUNDER) TO BE CONSIDERED BEFORE MAKING ANY DISALLOWANCE UNDER THIS SUB-SECTION. 14. THE SECOND PROVISO TO SECTION 40A(3) CLEARLY STATES AS FOLLOWS: ' PROVIDED FURTHER THAT NO DISALLOWANCES UNDER THIS SUB-SECTION SHALL BE MADE WHERE ANY PAYMENT IN A SUM EXCEEDING [TWENTY]THOUSAND RUPEES IS MADE OTHERWISE THAN BY [AN ACCOUNT PAYEE CHEQUE DRAWN ON A BANK OR ACCOUNT PAYEE DRAFT], IN SUCH CASES AND UNDER SUCH CIRCUMSTANCES AS MAY BE PRESCRIBED (1), HAVING REGARD TO THE NATURE AND EXTENT OF BANKING FACILITIES AVAILABLE (2), CONSIDERATIONS OF BUSINESS EXPEDIENCY AND OTHER RELEVANT FACTORS(3).' 15. HENCE BEFORE MAKING ANY DISALLOWANCE U/S 40A(3) THE AO HAS TO TAKE IN TO CONSIDERATION OF TH E ABOVE THREE FACTORS BEING 1 . CIRCUMSTANCES SPECIFIED UNDER RULE 6DD, 2. EXTENT OF BANKING FACILITIES AVAILABLE AND 3. THE CONSIDERATION OF BUSINESS EXPEDIENCY AND OTHER RELEVANT FACTORS. 16. THE AO HAVING ACCEPTED THE PAYMENTS FOR PURCHASE OF LANDS WHICH ARE SUPPORTED BY THE DEEDS AND BOOKS OF ACCOUNTS OUGHT TO HAVE CONSIDERED THE BUSINESS EXPEDIENCY AND OTHER RELEVANT FACTORS BEFORE MAKING SUCH DISALLOWANCES. 17. A VIEW HAS BEEN TAKEN THAT THE CIRCUMSTANCES SET OUT IN RULE 6DD(J) ARE ILLUSTRATIVE AND NOT EXHAUSTIVE AND THE ASSESSING OFFICER HAS TO TAKE INTO ACCOUNT THE SURROUNDING CIRCUMSTANCES AND CONSIDERATIONS OF BUSINESS EXPEDIENCY. 18. ANOTHER ACTIVITY OF THE APPELLANT IN THE REAL E STATE IS TO ACT AS A POA HOLDER FOR THE SELLERS (LAND OWNERS) TO SELL THEIR PROPERTIES TO THEIR CUSTOMERS FOR EARNING PROFIT THERE FROM. THE APPELLANT HAD ALSO ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 11 ACTED AS A MEDIATOR/FACILITATOR/AGENT BETWEEN THE PURCHASERS AND SELLERS OF THE LANDS FOR GETTING B R OKERAGE/COMMISS I ON WITHOUT INCORPORATING HIS NAME IN THE DEED OF SALE. 19. FOR THE PRESENT ASSESSMENT YEAR, THE APPELLANT HAD RETURNED AN INCOME FROM THESE ACTIVITIES TO THE EXTENT OF RS.54,54,944/- AND AFTER RECOMPUTATION TH E APPELLANT HAD SHOWN THE BROKERAGE INCOME AT A REVISED FIGURE OF RS.87,89,865/-, FOR WHICH A TABUL ATION IS GIVEN IN PAGE 8 OF THE IMPUGNED ORDER. CONSIDERI NG THE APPLICABILITY SECTION 40A(3) OF THE ACT THE ASSESSING OFFICER AT PAGE 9 OF THE IMPUGNED ORDER HAD ACCEPTED THE STAND OF THE APPELLANT ON THE NON- APPLICABILITY OF THE SAID PROVISION IN THE ACT . HOWEVER, FOR THE TRANSACTIONS TABULATED I N PAGES 9 & 10 OF THE IMPUGNED ORDER, THE ASSESSING OFFICER INVOKED SECT I ON 40A(3) OF THE ACT AND MADE DISALLOWANCE OF RS.79,663/ - . IN THE L I GHT OF THE DECISION OF THE MADRAS HIGH COURT REPORTED IN 282 ITR 117, IT IS SUBMITTED THAT THE PAYMENTS ON A SINGLE DAY WH I CH WERE BELOW RS.20,OOO/- WOULD NOT ATTRACT THE PROVISIONS OF SECTION 40A(3) OF THE ACT. 20. THE ASSESSING OFFICER FURTHE R DISALLOWED RS.12,390/ - INVOKING SE CT ION 40A(3) OF THE ACT ON THE BROKERAGE PAID TO THE EXTENT OF RS.61,954/ - TO BASHEER AHMED AND R. MUTHU ON RS.79,663/- MADE U/S 40A(3) OF THE ACT IN T HE ACCEPTANCE OF G R OUNDS RAISED IN THE PRESENT PROCEEDINGS. THE ABOVE DECISION IS RENDERED IN TUNE W I TH ORDER GIVEN ON THE SIMILAR I SSUES REFLECTED IN THE OTHER PART OF THIS ORDER. ON THE CONSIDERATION OF FACTS AND ARGUMENTS, THE PAYMENT MADE TO MRS.DEVI MOHAN FOR PURCHASE OF PROPERTY ON 12.9.2005 WOULD NOT ATTRACT THE PROV I SIONS OF SECTION 40A(3) OF THE ACT INASMUCH AS THE IDENTI TY OF THE RECIPIENT AND SOURCE FOR THE SALE CONS I DE R ATION HAVING BEEN NOT DISPUTED, THE DISALLOWANCE UNDER CONSIDERATION IS NOT WARRANTED ON THE FACTS AND I N THE CIRCUMSTANCES OF THE CASE. 2 1 . WITH REGARD TO THE ADDITION OF RS . 40,000/ - BE I NG 20% OF RS. 2,00,000/ - , PAID TO MRS. DEVI MOHAN FOR ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 12 PUCHASE OF PROPERTY ON 12.9 . 2005 WOULD NOT ATTRACT THE PROVISIONS OF SECT I ON 40A( 3 ) OF THE ACT INASMUCH AS THE IDENTITY OF THE RECIPIE N T AND SOURCE FOR THE SALE CONSIDERATION HAVING BEEN NOT DISPUTED . 2 2 . SIMILARLY THE ADDITION OF RS.2,20,OOO/- I NVOKING SECTION 40A(3) OF THE ACT, THE PURCHASE OF LANDS THROUGH THE EMPLOYEES OF THE APPELLANT HAVING BEEN NOT DISPUTED THE T R ANSACTION UNDER CONSIDERATION AND FURTHER NOT DISPUTED THE SOURCE FOR THE PAYMENTS, T HE PROVISIONS OF SECTION 40A(3) OF THE ACT ARE ERRONEOUSLY INVOKED AND APPLIED TO THE FACTS OF THE CASE. 23. THE ASSESSING OFFICER DISALLOWED RS4,00,000/- INVOKING SECTION 40A(3) OF THE ACT RE L ATING TO THE PROPERTY PURCHASE TRANSACTION FROM A COMPANY CALLED S.A.K.DEVELOPERS. THE TRANSACTION TOOK PLACE ON 1 . 1 . 2006 AND THE APPELLANT PAID CASH OF RS.20 LAKHS. 24 . THE ASSESSING OFFICER DISALLOWED RS.10,OOO/- INVOKING SECTION 40A(3) OF THE ACT RELATING TO THE PROPERTY PURCHASE TRANSACTION WITH MR . DWARAKANATH REDDY. THE TRANSACTION TOOK PLACE ON 25.1 . 2006 AND THE APPELLANT PAID CASH OF RS.50,OOO/-. 25. THE ASSESSING OFFICER DISALLOWED RS.57,600/- INVOKING SECTION 40A(3) OF THE ACT RELATING TO THE PROPERTY PURCHASE TRANSACTION WITH R.SARAVANAN. THE TRANSACTION TOOK PLACE ON 8.3.2006 AND THE APPELLAN T PAID CASH OF RS.2,88,OOO/-. 26. THE ASSESSING OFFICER DISALLOWED RS . 57,600/ - INVOKING SECTION 40A(3) OF THE ACT RELATING TO THE PROPERTY PURCHASE TRANSACTION WITH MRS.BABITHA BHANDARI . THE TRANSACTION TOOK PLACE ON 25.3.2006 AND THE APPELLANT PA I D CASH OF RS.2,88,OOO/-. 27. THE ASSESSING OFFICER DISALLOWED RS.5,39,OOO/- INVOKING SECTION 40A(3) OF THE ACT RELATING TO THE ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 13 PROPERTY PURCHASE TRANSACTION WITH R.PARANTHAMAN. THE TRANSACTION TOOK PLACE ON 10.2.2006 AND THE APPELLANT PAID CASH OF RS.26,95,OOO/-. 28. I HAVE GONE THROUGH THE ASSESSMENT ORDER AS WELL AS THE SUBMISSIONS GIVEN BY THE AR OF THE APPELLANT AND ALSO THE CASE LAWS RELIED BY THE APPELLANT . THE AO IS OF THE OPINION THAT SINCE THE CASH PAYMENTS WERE MADE AND ACCORDINGLY HE DISALLOWED 20% OF THE EXPENSES U/S.40A(3). HOWEVER, THE AR OF THE APPELLANT PLEADED THAT FOR T HE NATURE OF THE BUSINESS THE APPELLANT INVOLVED I . E. REAL ESTATE ON THE SECOND PROVISO TO SECTION 40A(3) SECTION 40A(3) IS CLEARLY APPLICABLE TO THIS CASE A ND FURTHER HE HAS FILED THE ADDITIONAL SUBMISSIONS AS UNDER :- 'JANUARY 1 ST WAS A HOLIDAY AND HENCE THE PAYMENT OF 20 LAKHS TO SAK DEVELOPERS IN ANY EVENT WOULD NOT BE HIT BY THE PROVISIONS OF SECTION 40A(3) OF THE ACT. THE REAL ESTATE SECTOR WAS DOING REALLY WELL DURING 2005 TO 2007 AND THE OWNERS WERE WILLING TO SELL ONLY ON IMMEDIATE CASH PAYMENTS. MOST OF THE PROPERTIES DEALT BY THE APPELLANT WERE SITUATED AT VILLAGES WHICH DID NOT HAVE ANY BANKING FACILITIES. EVEN IF THE OWNERS WERE IN SOME CASES AT CHENNAI, THE APPELLANT HAD PAID CASH BASICALLY ON THE TRADE PRACTICE AND CONSIDERATION OF THE BUSINESS EXPEDIENCY AS EXPLAINED BELOW IN THIS SECTOR: IN PRACTICAL SITUATION, THE AGENT/MIDDLE MAN BRINGS THE PROPERTY DOCUMENTS ALONG WITH POA COPY ETC AND REPRESENTS THE OWNER. THE REAL OWNER IN MOST OF THE CASES WILL NOT COME AND DEAL THE PROPERTY. THE AGENT TAKES THE PURCHASER / APPELLANT TO THE SITE VERIFICATION, COORDINATES WITH THE LEGAL TEAM ETC AND ACCEPTS THE CASH OR CHEQUE ON OWNER'S BEHALF AND IN MANY ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 14 CASES SIGNS THE SALE DEED AS A POA HOLDER. THE ABOVE PRACTICE WAS FOLLOWED CONSISTENTLY IN THIS TRADE AS THE AGENT/MIDDLE MAN FIXES AN 'X' RATE WITH THE PURCHASE/APPELLANT AND MAY GIVE IN MANY CASES TO THE LAND OWNERS 'X MINUS Y', THE 'Y' BEING HIS MARGIN. BY THIS WAY THE MIDDLE MAN MAKES MORE MONEY AS A PROJECT INCOME RATHER THAN A TRADITIONAL TYPE OF CHARGING A REGULAR 2% COMMISSION. THIS PRACTICE WAS ALSO FOLLOWED BY THE APPELLANT HIMSELF AND HAD OFFERED THE MARGIN BY HIM AS 'PROJECT INCOME'. IN THIS METHOD THE APPELLANT FIXES A PRICE WITH THE PROPOSED SELLER AND A DIFFERENT PRICE WITH THE PROPOSED BUYER AND RETAIN THE DIFFERENCE WITH HIM, SHOWING THE SAME AS 'PROJECT INCOME'.' 29. FURTHER I HAVE ALSO GONE THROUGH THE DECISION I N THE CASE OF CO M MISSIONER OF INCOME TAX VS. P.PRAVIN AND CO. 274 ITR 534 WHEREIN IT IS HELD THA T THE RIGOUR OF THE RULE MAY BE RELAXED IN CONSIDERAT ION WITH THE BUS I NESS EXPEDIENCY AND OTHER RELEVANT FACTORS. THE APPELLANT DEALS IN REAL ESTATE BUSINES S WHERE THE COMPETITION IS VERY HIGH AND THE ELEMENT OF CASH PAYMENT IS VERY MUCH IN VOGUE. RESPECTFULLY FOLLOWING THE RATIO FOLLOWED IN CIT VS. P.PRAVIN AND CO. 274 ITR 534 THE PROVISION U/S 40A(3) MAY NOT ATTRACT IN THE APPELLANT CASE AND ACCORDINGLY THE AO IS DIRECTED TO DELETE THE ADDITI ON OF RS. 14,16,253/- ( RS. 13,24,000 + 79,663 + 12,390). 30. IN THE RESULT, THE APPEAL IS ALLOWED. 7. ON GOING THROUGH THE ABOVE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), WE FIND THAT ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 15 ASSESSEE HAS MADE PAYMENTS TO VARIOUS PARTIES FOR PURCHASE OF PLOTS / PAID BROKERAGE IN THE COURSE OF CARRYING ON ITS BUSINESS OF PURCHASE & SALE OF PLOT S/FLATS. ALL THESE PAYMENTS WERE MADE IN VIEW OF BUSINESS EXPEDIENCY AND TRANSACTIONS ARE GENUINE. 8. THE HONBLE GUJARAT HIGH COURT IN THE CASE OF ANUPAM TELE SERVICES VS. ITO (SUPRA) HELD AS UNDER :- IT COULD BE APPRECIATED THAT SECTION 40A AND IN PARTICULAR SUB-CLAUSE (3) THEREOF AIMS AT CURBING T HE POSS I BILITY OF ONMONEY TRANSACTIONS BY INSISTING THAT AL L PAYMENTS WHERE EXPENDITURE IN EXCESS OF A CERTA I N SUM [IN THE PRESENT CASE TWENTY THOUSAND RUPEES] MUST B E MADE BY WAY OF ACCOUNT PAYEE CHEQUE DRAWN ON A BANK OR ACCOUNT PAYEE BANK DRAFT . AS HEL D BY THE APEX COURT IN CASE OF ATTAR SINGH GURMUKH SINGH [SUPRA] , ' . IN OUR OPINION , THERE I S LITTLE MER I T I N THIS CONTENTION . SECTION 40A(3) MUST NOT BE READ IN ISOLATION OR TO THE EXCLUSION OF RULE 600 . THE SECTION MUST BE READ ALONG WITH THE RULE. IF READ TOGETHER , IT WILL BE CLEAR THAT THE PROVISIONS ARE NOT INTENDED TO RESTRICT THE BUSINES S ACTIVITIES . THERE IS NO RESTRICTION ON THE ASSESSEE IN HIS TRADING ACTIVITIES . SECTION 40A(3) ONLY EMPOWERS THE ASSESSING OFFICER TO DISALLOW THE DEDUCTION CLA I MED AS EXPEND I TURE IN RESPECT OF WHICH PAYMENT IS NOT MADE BY CROSSED CHEQUE OR CROSSED BANK DRAFT . THE PAYMENT BY CROSSED CHEQUE OR CROSSED BANK DRAFT IS INSISTED ON TO ENABLE THE ASSESSING AUTHORITY TO ASCERTAIN WHET HER THE PAYME N T WAS GENUINE OR WHETHER IT WAS OUT OF THE INCOME FROM UNDISCLOSED SOURCES . THE TERMS OF SECT I ON 40A ( 3 ) ARE NOT ABSOLUTE. CONSIDERATIONS OF BUSINESS EXPEDIENCY AND OTHER RELEVANT FACTORS ARE NOT EXCLU DED. GENUINE AND BONA FIDE TRANSACT I ONS ARE NOT TAKEN OUT OF THE SWEEP OF THE SECTION . IT IS OPEN TO THE ASSESSEE TO FURNISH TO THE SATISFACTION OF THE ASSESSING OFFICE R THE CIRCUMSTANCES UNDER WHICH THE PAYMEN T IN THE MANNER PRESCRIBED IN SECTION 40A (3) WAS NOT PRACTICABLE O R WOULD HAVE CAUSED GENUINE DIFFICULTY TO THE PAYEE . IT IS ALSO OPEN TO THE ASSESSEE TO IDENTIFY THE PERSON WHO HAS RECEIVED THE CASH PAYME N T . ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 16 RULE 6DD PROVIDES THAT AN ASSESSEE CAN BE EXEMPTED FROM THE REQUIREMENT OF PAYMENT BY A CROSSED CHEQUE OR CROSSED BANK DRAFT IN THE CIRCUMSTANCES SPECIFIE D UNDER THE RULE . IT WI L L BE C L EAR FROM THE PROVISIONS OF SECTION 40A(3) AND RU L E 6DD THAT THEY ARE INTENDED TO REGULATE BUSINESS TRANSACTIONS AND TO PREVENT THE USE OF UNACCOUNTED MONEY OR REDUCE T HE CHANCES TO USE BLACK MONEY FOR BUSINESS TRANSACT I ONS . THE HONBLE HIGH COURT OBSERVED THAT THE HONBE SU PREME COURT IN THE CASE OF ATTAR SINGH GURMUKH SINGH VS. ITO (191 ITR 667) HELD THAT THE PROVISIONS OF SECTION 40A(3 ) ARE NOT INTENDED TO RESTRICT THE BUSINESS ACTIVITIES. THERE IS NO RESTRICTION ON THE ASSESSEE ON HIS TRADING ACTIVITI ES. THE TERMS OF SECTION 40A(3) ARE NOT ABSOLUTE. THE GENUI NE AND BONAFIDE TRANSACTIONS ARE NOT TAKEN OUT OF THE SWEE P OF THE SECTION AND CONSIDERATIONS OF BUSINESS EXPEDIENCY A ND OTHER RELEVANT FACTORS ARE NOT EXCLUDED. THE PROVISIONS OF SECTION 40A(3) AND RULE 6DD ARE INTENDED TO REGULATE BUSINE SS TRANSACTIONS AND THE PREVENT THE USE OF UNACCOUNTED MONEY OR REDUCE THE CHANCES TO USE BLACK MONEY FOR BUSINE SS TRANSACTIONS. 9. HERE IN THE PRESENT CASE, IT IS NOT THE CONTENTI ON OF THE REVENUE THAT TRANSACTIONS ARE NOT GENUINE AND PAYME NTS ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 17 WERE ALL UNDISCLOSED MONEY. IT IS NOT THE CASE OF R EVENUE THAT PAYEE WAS NOT IDENTIFIED OR PAYEE DENIED THE RECEIP T OF MONEY. THEREFORE, TAKING TOTALITY OF THE FACTS AND CIRCUMSTANCES OF THE CASE INTO CONSIDERATION AND TH E CASE LAWS, WE ARE OF THE VIEW THAT COMMISSIONER OF INCOM E TAX (APPEALS) HAS RIGHTLY DELETED THE DISALLOWANCE FOLL OWING VARIOUS DECISIONS. WE SUSTAIN THE ORDER OF THE COMM ISSIONER OF INCOME TAX (APPEALS) AND DISMISS THE GROUNDS RAI SED IN BOTH THE APPEALS OF THE REVENUE. 10. THE FIRST ISSUE IN THE CROSS OBJECTION FILED BY THE ASSESSEE IS THAT COMMISSIONER OF INCOME TAX (APPEAL S) ERRED IN DISMISSING THE GROUND CHALLENGING ADDITION RELATING TO CYCAD PROJECT. THE OTHER ISSUE IN THE CROSS OBJECTI ON IS THAT COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN DISMI SSING THE GROUNDS CHALLENGING ADDITION RELATING TO HARRIN GTON PROJECT. 11. THE ASSESSEE RAISED GROUND NO. 11 IN RESPECT OF DELETION OF DISALLOWANCE MADE UNDER SECTION 40A(3) OF THE ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 18 ACT. SINCE THIS GROUND WAS RAISED IN SUPPORT OF THE ORDER OF COMMISSIONER OF INCOME TAX (APPEALS) AND SINCE WE H AVE ALREADY DISMISSED THE APPEALS OF THE REVENUE CONFIR MING DELETION OF DISALLOWANCES, THIS GROUND OF APPEAL RA ISED BY THE ASSESSEE IN THE CROSS OBJECTION BECOMES INFRUCTUOUS AND ACCORDINGLY THE SAME IS DISMISSED. 12. WITH REGARD TO OTHER ISSUES, COUNSEL FOR THE AS SESSEE PLACES RELIANCE ON THE GROUNDS OF APPEAL AND SUBMIT S THAT ADDITIONS BE DELETED. 13. DEPARTMENTAL REPRESENTATIVE RELYING ON THE ORDE R OF THE COMMISSIONER OF INCOME TAX (APPEALS) SUBMITS THAT N O INFORMATION WAS FURNISHED WITH REGARD TO THESE TWO ADDITIONS AND THEREFORE, COMMISSIONER OF INCOME TAX (APPEALS) IS JUSTIFIED IN SUSTAINING THESE TWO ADDITIONS. THE AS SESSING OFFICER MADE THESE TWO ADDITIONS AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AT THE TIME OF ASSESSME NT. ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 19 14. HEARD BOTH SIDES. PERUSED ORDERS OF LOWER AUTHO RITIES. THE COMMISSIONER OF INCOME TAX (APPEALS) CONFIRMED THE DISALLOWANCES OBSERVING AS UNDER:- 8. ADD I TI O N ON ACCOUNT OF CYCAD PROJE C T - RS.5,09,017 :- THE AO HAS STATED THAT ON ENQUIRY AT THE TIME OF SURVEY MADE, THE C OMMISSION EARNED BY HIM OF RS . 15,14,118/- WHEREAS THE APPELLANT HAS DE CLA R E D RS. 10,05,101 ONLY I N THE RETURN AND HENCE A SUM OF RS. 5,09,017/- W A S ADDED. IN THE EARLIER YEAR , THE APPE L LANT'S FATHER I . E. SHRI M A T H I VATHANAN, THE SURVEY REPORT IS THE BASIS FOR OTHE ASSESSMENT (BOTH THE AO A ND T H E APPELLANT RELIED ON THE SURVEY REPORT) AND ACCORDINGLY TH E ADDITION O F RS . 5,09,017/- IS CONF I RMED . 9 . ADDITION ON ACCOUNT OF HARRINGTON PROJECT RS. 7,62,509/- W I TH REGARD TO ADDITION ON ACCOUNT OF HARRINGTON PROJECT, IT IS SEEN T HAT DU R ING THE COURSE OF SURVEY, THE APPELLANT HAS MADE A PROF I T OF RS. 25,00 , 000/ - AND RS. 19 , 40,000/ - FROM THE PROJECTS AT HARRINGTON NAGAR AND OTHER F I VE PROJECTS RESPECTIVELY. OUT OF THIS , THE APPELLANT HAS SHOWN C OMMI S SION INCOME OF RS. 29 , 08,713/- AND RS. 2 , 53,111/- WAS STATED TO H AVE BEEN INCLUDED IN THE PROFIT . ALSO HE STAT E D THAT PART OF THE INCOME I . E. RS. 5 , 1 5,667/- HAD BEEN OFFERED FOR THE ASST.YEAR 2006-07 FROM HARRINGTON ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 20 NAGAR PROJECT . HENCE THE BALANCE AMOUNT I .E. AS PER WORK I NG SHOWN BELOW IS ADDE D AS INCOME OF THE APPELLANT BY THE AO . AS PER SURVEY REPORT : ` 44,40,000 LESS: ALREADY SHOWN : ` 29,08,713 LESS:I) INCLUDED IN THE PROFIT ALREADY AS PER APPELLANT: ` 2,53,111 II)INCOME OFFERED FOR ASST.YEAR 2006-07 ` 5,15,667 ` 7,68,778 DIFFERENCE ` 7,62,509 AS THIS DIFFERENCE OF ` 7,62,509/- HAS NOT BEEN SHOWN AS INCOME, I AM ALSO AGREEING WITH THE DECISION OF THE ASSESSING OFFICER AND THIS ADDITION OF ` 7,62,509/- IS CONFIRMED. 15. ON GOING THROUGH THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS), WE DO NOT FIND ANY VALID REAS ON TO INTERFERE WITH HIS FINDINGS IN SUSTAINING THE ADDIT IONS. NO EVIDENCE WAS PRODUCED BY THE ASSESSEE BEFORE US TO REBUT THE FINDINGS OF THE COMMISSIONER OF INCOME TAX (APP EALS). WE THEREFORE, UPHOLD THE ORDER OF THE COMMISSIONER OF INCOME TAX (APPEALS) AND REJECT THE GROUNDS OF ASSE SSEE IN THE CROSS OBJECTION. IN THE RESULT, CROSS OBJECTION OF THE ASSESSEE IS DISMISSED. ITA NOS.1339 & 1340/MDS/2011 & C.O.NO.136/MDS/2011 21 16. TO SUM UP, BOTH THE APPEALS OF THE REVENUE AND CROSS OBJECTION OF THE ASSESSEE ARE DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON FRIDAY, THE 21 ST DAY OF MARCH, 2014 AT CHENNAI. SD/- SD/- (A.MOHAN ALANKAMONY) (CHALLA NAGEN DRA PRASAD) ACCOUNTANT MEMBER JUDI CIAL MEMBER CHENNAI, DATED THE 21 ST MARCH, 2014. SOMU COPY TO: (1) ASSESSEE (4) CIT(A) (2) ASSESSING OFFICER (5) D.R (3) CIT (6) G.F.