The Income Tax Officer, Jammu V. M/s Gurbaksh Rai and Sons, Jammu

ITA 567/ASR/2015

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 8773 (ITAT-AMRITSAR)
• Duration Of Justice: 1 year(s) 3 month(s) 5 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-02-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 28-11-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 02-11-2015
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: VEDPAL SINGH
• Assessee Lawyers: P N ARORA
• Section: 40A(3)

Judgement Text

IN THE INCOME TAX APPELLA TE TRIBUNA AMRITSAR BENCH; AMRITSAR BEFORE SH.T.S. KAPOOR, ACCOUNTANT MEMBER AND SH.SANJAY GARG, JUDICIAL MEMBER I.T.A. NO.567(ASR)/2015 ASSESSMENT YEA R: 2009-10 INCOME-TAX OFFICER, WARD-2, JAMMU. VS. M/S. GURBAKSH RAI AND SONS. JAIN BAZAR, JAMMU. PAN:AADFG7840B (APPELLANT) (RESPONDENT) APPELLANT BY: SH. VEDPAL SINGH, DR RESPONDENT BY: SH. P.N.ARORA, ADV. DATE OF HEARING: 28/11/2016 DATE OF PRONOUNCEMENT: 07/02/2017 ORDER PER T.S. KAPOOR, AM: THIS IS AN APPEAL FILED BY REVENUE AGAINST THE ORD ER OF LD. CIT(A), AMRITSAR, DT.05.08.2015 FOR ASST. YEAR: 2009-10. 2. THE REVENUE IS AGGRIEVED WITH THE ACTION OF LD. CIT(A), BY WHICH HE HAS DELETED THE ADDITION MADE BY ASSESSING OFFICER FOR VIOLATION OF PROVISIONS OF SEC.40A(3) OF THE ACT. 3. AT THE OUTSET, THE LD. DR SUBMITTED THAT ASSESSI NG OFFICER HAD RIGHTLY MADE THE ADDITION U/S 40A(3) AS THE ASSESSE E WAS NOT JUSTIFIED IN MAKING CASH PAYMENTS IN VIOLATION OF SEC.40A(3) AS BOTH THE SELLER AS WELL AS PURCHASER WERE HAVING BANK ACCOUNTS. THE LD . DR FURTHER ITA NO.567/ASR/2015 ASST. YEAR. 2009-1 0 2 SUBMITTED THAT OUT OF TOTAL EXPENSES, THE ASSESSEE HAD MADE CASH PAYMENTS OF RS.20,000/- IN 313 DAYS IN THE YEAR WHI CH AMOUNTED TO RS.62,60,000/-. IT WAS SUBMITTED THAT ASSESSEE HAD DELIBERATELY SPLIT UP THE LARGE PAYMENTS IN AMOUNTS NOT EXCEEDING RS.20,0 00/- TO AVOID THE BREACH OF VIOLATION OF SEC.40A(3). THE LD. CIT(A) H AS WRONGLY ALLOWED THE RELIEF TO THE ASSESSEE. 4. THE LD. AR, ON THE OTHER HAND, SUBMITTED THAT IT IS AN UNDISPUTED FACT THAT NONE OF THE PAYMENTS EXCEEDED RS.20,000/- AND THEREFORE, THE ASSESSEE HAD NOT VIOLATED THE PROVISIONS OF SEC.40A (3) AND THEREFORE, ASSESSING OFFICER, ON THE BASIS OF ASSUMPTIONS HAD MADE ADDITIONS AND WHICH THE LD. CIT(A) HAD RIGHTLY DELETED. 5. WE HAVE HEARD THE RIVAL PARTIES AND HAVE GONE TH ROUGH THE MATERIAL PLACED ON RECORD. WE FIND THAT LD. CIT(A) HAS MADE A FINDING OF FACT THAT ON NONE OF THE DAYS THE AMOUNT OF PAYMENT EXCEEDED RS.20,000/-. HE FURTHER OBSERVED THAT THE ASSESSING OFFICER COULD NOT MAKE A CASE THAT THESE PAYMENTS WERE NOT GENUINE. H E HAS ALSO VERIFIED THAT THE PAYMENTS MADE BY THE ASSESSEE WERE CONFIRM ED FROM THE BOOKS OF ACCOUNT TO WHOM THE PAYMENTS WERE MADE. WE FIND THAT THE ASSUMPTION OF ASSESSING OFFICER THAT AMOUNT WAS DEL IBERATELY SPLIT UP IS MEANINGLESS AND WITHOUT ANY FOUNDATION. SINCE NONE OF THE PAYMENTS HAD EXCEEDED RS.20,000/-, THE PROVISIONS OF SEC.40A (3) WERE NOT ITA NO.567/ASR/2015 ASST. YEAR. 2009-1 0 3 APPLICABLE AND THEREFORE, THE LD. CIT(A) HAS RIGHTL Y ALLOWED RELIEF AND WE DO NOT FIND ANY INFIRMITY IN THE ORDER OF LD. CIT( A). 6. IN VIEW OF THE ABOVE, THE APPEAL FILED BY THE RE VENUE IS DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 07/02/2017 . SD/- SD/- (SANJAY GARG) (T.S. KAPOOR ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 07/02/2017 /PK/PS COPY OF THE ORDER FORWARDED TO: 1. THE ASSESSEE: 2. THE 3. THE CIT(A), 4. THE CIT, 5. THE SR DR, ITAT, AMRITSAR. TRUE COPY BY ORDER