Bipin Kr. Gupta Prop: M/s Balaji Alankar, Paschim Medinipur V. ACIT Circle 39, Midnapore, Midnapore

ITA 542/KOL/2017

• Counselvise Citation: [2018] 121 COUNSELVISE.COM (IT) 6462 (ITAT-KOLKATA)
• Duration Of Justice: 1 year(s) 19 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 09-04-2018
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: SMC
• Assessment Year: 2009-2010
• Appeal Filed On: 20-03-2017
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ALOK NAG
• Assessee Lawyers: GAUTAM GHOSH
• Section: 40A(3); 143(3)

Judgement Text

I.T.A. NO 542/KOL/2017 ASSESSMENT YEAR: 2 009-2010 PAGE 1 OF 4 IN THE INCOME TAX APPELLATE TRIBUNAL, KOLKATA SMC BENCH, KOLKATA BEFORE SHRI P.M. JAGTAP, ACCOUNTANT MEMBER I.T.A. NO. 542/KOL/2017 ASSESSMENT YEAR: 2009-2010 BIPIN KUMAR GUPTA,................................. ...........................APPELLANT PROP. BALAJI ALANKAR, S-194, GOLEBAZAR, KHARAGPUR-721 301, PASCHIM MEDINIPUR [PAN: ADLPG 9567 C] -VS.- DEPUTY COMMISSIONER OF INCOME TAX,................. ...........RESPONDENT CIRCLE-2, MIDNAPUR, SAHOO BHAWAN, ZILLA PARISHAD ROAD, P.O. MIDNAPORE-72, DIST. PASCHIM MEDINIPUR APPEARANCES BY: SHRI GAUTAM GHOSH, ADVOCATE, FOR THE APPELLANT SHRI ALOK NAG, ADDL. CIT, D.R., FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : APRIL 09, 2018 DATE OF PRONOUNCING THE ORDER : APRIL 09, 2018 O R D E R THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAI NST THE ORDER OF LD. COMMISSIONER OF INCOME TAX (APPEALS)-11, KOLKATA DA TED 20.10.2016, WHEREBY HE CONFIRMED THE ADDITION OF RS.1,96,595/- MADE BY THE ASSESSING OFFICER BY WAY OF DISALLOWANCE OF PURCHAS ES UNDER SECTION 40A(3) OF THE INCOME TAX ACT, 1961. 2. THE ASSESSEE IN THE PRESENT CASE IS AN INDIVIDUA L, WHO IS ENGAGED IN THE BUSINESS OF TRADING OF GOLD ORNAMENTS. THE RETU RN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY HIM ON 24.09. 2009 DECLARING TOTAL INCOME OF RS.9,98,204/-. DURING THE COURSE OF ASSES SMENT PROCEEDINGS, IT WAS NOTICED BY THE ASSESSING OFFICER THAT THE ASSES SEE HAS MADE CERTAIN PAYMENTS IN CASH AGAINST PURCHASES EXCEEDING RS.20, 000/-. HE, THEREFORE, I.T.A. NO 542/KOL/2017 ASSESSMENT YEAR: 2 009-2010 PAGE 2 OF 4 INVOKED THE PROVISIONS OF SECTION 40A(3) AND MADE A DISALLOWANCE ON ACCOUNT OF CASH PURCHASES AGGREGATING TO RS.1,96,59 5/- IN THE ASSESSMENT COMPLETED UNDER SECTION 143(3) VIDE AN ORDER DATED 30.12.2011. 3. THE DISALLOWANCE MADE BY THE ASSESSING OFFICER U NDER SECTION 40A(3) WAS CHALLENGED BY THE ASSESSEE IN THE APPEAL FILED BEFORE THE LD. CIT(APPEALS). DURING THE COURSE OF APPELLATE PROCEE DINGS BEFORE THE LD. CIT(APPEALS), IT WAS SUBMITTED BY THE ASSESSEE THAT THE CASH PURCHASES IN QUESTION WERE MADE UNDER DIFFERENT BILLS AND NONE O F SUCH BILLS EXCEEDED RS.20,000/-. IT WAS ALSO BROUGHT TO THE NOTICE OF T HE LD. CIT(APPEALS) BY THE ASSESSEE THAT EVEN THE PAYMENTS MADE IN CASH AG AINST THE SAID PURCHASES NEVER EXCEEDED RS.20,000/- IN A SINGLE TR ANSACTION. THIS STAND OF THE ASSESSEE WAS NOT FOUND ACCEPTABLE BY THE LD. CIT(APPEALS). ACCORDING TO HIM, SUCH STAND WAS NOT TAKEN BY THE A SSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE THE ASSESSI NG OFFICER AND THE SAME EVEN OTHERWISE WAS NOT ACCEPTABLE ON MERIT KEE PING IN VIEW THE AMENDMENT MADE IN SECTION 40A(3) BY THE FINANCE ACT , 2008 W.E.F. 1 ST APRIL, 2009, WHEREBY EVEN THE AGGREGATE OF PAYMENTS AGAINST ANY EXPENDITURE IN CASH EXCEEDING RS.20,000/- WAS COVER ED BY SECTION 40A(3). HE ACCORDINGLY CONFIRMED THE ADDITION OF RS .1,96,595/- MADE BY THE ASSESSING OFFICER BY WAY OF DISALLOWANCE UNDER SECTION 40A(3) OF THE ACT. AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS) , THE ASSESSEE HAS PREFERRED THIS APPEAL BEFORE THE TRIBUNAL. 4. I HAVE HEARD THE ARGUMENTS OF BOTH THE SIDES AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IN SUPPORT O F THE ASSESSEES CASE ON THE ISSUE UNDER CONSIDERATION, THE LD. COUNSEL FOR THE ASSESSEE HAS RELIED ON THE DECISION OF COCHIN BENCH OF THIS TRIBUNAL IN THE CASE OF RAJA & CO. VS.- CIT [64 SOT 12], WHEREIN IT WAS HELD THAT IF AN ASSESSEE MAKES PAYMENT OF TWO DIFFERENT BILLS WITH NONE OF THEM EX CEEDING RS.20,000/- AT THE SAME TIME IN CASH, SECTION 40A(3) IS NOT APPLIC ABLE EVEN IF THE AGGREGATE PAYMENT IS MORE THAN RS.20,000/-. EXPLAIN ING FURTHER, IT WAS OBSERVED BY THE TRIBUNAL THAT SECTION 40A(3) IS APP LICABLE ONLY IN RESPECT I.T.A. NO 542/KOL/2017 ASSESSMENT YEAR: 2 009-2010 PAGE 3 OF 4 OF AN EXPENDITURE WHICH IS IN EXCESS OF RS.20,000/- AND FOR APPLICABILITY OF SECTION 40A(3), BOTH THE PAYMENT AND AMOUNT OF B ILL SHOULD EXCEED RS.20,000/-. AS CLAIMED BY THE LD. COUNSEL FOR THE ASSESSEE, NEITHER THE AMOUNT OF BILL NOR EVEN THE PAYMENT MADE AGAINST SU CH BILLS IN CASH EXCEEDED RS.20,000/- IN A SINGLE TRANSACTION IN THE PRESENT CASE AND THE DECISION OF COCHIN BENCH OF THIS TRIBUNAL IN THE CA SE OF RAJA & CO. (SUPRA) THUS IS CLEARLY APPLICABLE IN THE FACTS OF THE ASSE SSEES CASE. EVEN THE LD. D.R. HAS NOT DISPUTED THIS POSITION IN PRINCIPLE. H E, HOWEVER, HAS CONTENDED THAT SINCE THIS CLAIM WAS NOT SPECIFICALL Y MADE BY THE ASSESSEE DURING THE COURSE OF ASSESSMENT PROCEEDINGS BEFORE THE ASSESSING OFFICER, AN OPPORTUNITY MAY BE GIVEN TO THE ASSESSING OFFICE R TO VERIFY THE SAME. I FIND MERIT IN THE CONTENTION OF THE LD. D.R. AND SI NCE THE LD. COUNSEL FOR THE ASSESSEE HAS ALSO NOT RAISED ANY OBJECTION IN T HIS REGARD, I SET ASIDE THE IMPUGNED ORDER OF THE LD. CIT(APPEALS) ON THIS ISSUE AND RESTORE THE MATTER TO THE FILE OF THE ASSESSING OFFICER FOR DEC IDING THE SAME AFRESH IN THE LIGHT OF THE DECISION OF COCHIN BENCH OF THIS T RIBUNAL IN THE CASE OF RAJA & CO. (SUPRA) AFTER VERIFYING THE RELEVANT FAC TS FROM RECORD. 5. IN THE RESULT, THE APPEAL OF THE ASSESSEE IS TRE ATED AS ALLOWED FOR STATISTICAL PURPOSES. ORDER PRONOUNCED IN THE OPEN COURT ON APRIL 09, 201 8. SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER KOLKATA, THE 9 TH DAY OF APRIL, 2018 COPIES TO : (1) SHRI BIPIN KUMAR GUPTA, PROP. BALAJI ALANKAR, S-194, GOLEBAZAR, KHARAGPUR-721 301, PASCHIM MEDINIPUR (2) DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-2, MIDNAPUR, SAHOO BHAWAN, ZILLA PARISHAD ROAD, P.O. MIDNAPORE-72, DIST. PASCHIM MEDINIPUR (3) COMMISSIONER OF INCOME TAX (APPEALS)-11, KOLK ATA, I.T.A. NO 542/KOL/2017 ASSESSMENT YEAR: 2 009-2010 PAGE 4 OF 4 (4) COMMISSIONER OF INCOME TAX- , (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER SENIOR PRIVATE SECRETARY, HEAD OF OFFICE/D.D.O. INCOME TAX APPELLATE TRIBUNAL, KOLKATA BENCHES, KOLKATA LAHA/SR. P.S.