TMI Blog2020 (9) TMI 157X X X X Extracts X X X X X X X X Extracts X X X X ..... f this court is no longer respondent integra and is covered by a decision of the Supreme Court in Calcutta Exports Company [ 2018 (5) TMI 356 - SUPREME COURT] and the same does not require any adjudication. Therefore, the same is answered in favour of the assessee and against the revenue. Though we are conscious of the legal principle that finality has to be attached to all legal proceedings, but in the peculiar facts of the case since, factual adjudication is required so far as substantial question of law Nos.1 and 3 are concerned, which has not been done by the Income Tax Appellate Tribunal, which is the final fact finding authority, we are left with no option but to set aside the order passed by the Income Tax Appellate Tribunal insofar as it pertains to substantial questions of law No.1 and 3 and remit the matter to the Tribunal for decision afresh on issues covered by substantial question of law Nos.1 and 3. Therefore, it is not necessary for us to answer the substantial questions of law No.1 and 3. - I.T.A. NO. 81 OF 2011 - - - Dated:- 1-9-2020 - THE HON'BLE MR. JUSTICE ALOK ARADHE And THE HON'BLE MR. JUSTICE H.T.NARENDRA PRASAD FOR THE PETITIONER : SRI. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assed an order under Section 153A read with Section 143(3) of the Act on 31.12.2007. 3. The assessee filed an appeal before the Commissioner of Income Tax (Appeals). The Commissioner of Income Tax (Appeals) by an order dated 30.03.2010 held that transportation expenses to the extent of ₹ 1,58,01,494/- was not genuine and therefore, the same was not incurred for the purpose of business carried on by the assessee. It was further held that transportation expenses to the extent of ₹ 1,47,52,025/- and ₹ 35,31,185/- paid to M/s M.M.Transport and S.Abdul Munaf were contrary to Section 40(a)(ia) of the Act. It was further held that payments were made in cash above the prescribed limit and therefore, there was violation of Section 40A(3) of the Act. Thus, total enhancement to the income on account of transportation expenses was made to the tune of ₹ 2,15,84,704/- and the appeal was dismissed. The assessee thereupon approached the Income Tax Appellate Tribunal (hereinafter referred to as 'the Tribunal', for short). The Tribunal by impugned order dated 21.10.2010 confirmed the addition of ₹ 31 Lakhs made in respect of payment to M/s IBL Enterprises. Ho ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 10.2005. It is further pointed out that the provision of Section 40(a)(ia) was incorporated by Finance Act, 2010, which is remedial / curative in nature and therefore, in view of decision of the Supreme Court in 'CIT VS. CALCUTTA EXPORT COMPANY', 404 ITR 654 (SC), and therefore, the second substantial question of law deserves to be answered in favour of the assessee and against the revenue. It is also urged that provision of Section 40A(3) is not applicable in case of the assessee as the firm has paid all payments through account payee crossed cheques only. It is further submitted that disallowance made under Section 40A(3) can be only on the basis of profit and loss account and only on those expenditures claimed in terms of Section 28 to Section 37 of the Act and the notional presumption of cash payments having been made, disallowance under Section 40A(3) of the Act is non sustainable in law. In this connection, reference has been made to Bank statement and ledger account to show that all payments were made by account payee crossed cheques. It is also argued that assessee at the time of beginning to commence the work had given some advance to transporters in certain transa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner of Income Tax (Appeals) except confirming addition of ₹ 31 Lakhs made by the assessing authority. Lastly, it was urged that policy of law is that there must be a point of finality in all legal proceedings, that still issues should not be reactivated beyond a particular stage and the lapse of time must induce repose in and set at rest judicial and quasi judicial controversies as it must in other spheres of human activity. In this connection, reliance has been placed on decision of the Supreme Court in 'PARASHURAM POTTERY WORKS CO. LTD., VS. INCOME-TAX OFFICER', (1977) 106 ITR 1 (SC). 7. We have considered the submissions made by learned counsel on both the sides and have perused the record. Before proceeding further, we may advert to the well settled legal principles. It is trite law that Income Tax Appellate Tribunal is the fact finding authority and it should normally record its conclusion on every disputed question raised before it, setting out its reasons in support of its conclusion. However, it is not necessary for the Tribunal to record reasons when the Tribunal fully agrees with the order passed by the Commissioner of Income Tax (Appeals). [See: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... facility. It was further held that payments made to transporters on a particular day exceeds ₹ 20,000/- therefore, provision of Section 40A(3) are applicable. The Commissioner of Income Tax (Appeals) enhanced the income of the assessment under appeal to the extent of ₹ 2,15,84,704/-. 9. Paragraph 14 and 18 of the order passed by the Income Tax Appellate Tribunal reads as under: 14. We heard both sides in detail. The Assessing Officer had made additions and the CIT(A) has enhanced the additions mainly on the ground of the statements extracted from the transport contractors who had rendered services to the assessee in its business of exporting iron ore. Both the authorities have overlooked a very vital aspect of whole episode while accepting the denial of the transporters of the receipts of any payments from the assessee. Those transporters have categorically admitted before the authorities that they had acted as the transporters of the assessee firm. On one side the concerned transporters admitted that they have rendered transport services to the assessee firm and on the other hand those persons denied any payments received from the assessee. This is patently con ..... X X X X Extracts X X X X X X X X Extracts X X X X
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