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2019 (7) TMI 713 - HC - Income TaxRevision u/s 263 - addition under Section 40A(3) and deposits made in Karur Vysa Bank - HELD THAT:- Tribunal commented that the CIT(A) having given a clear finding on the above lines ought not to have adjudicated on the additions assailed by the assessee which additions emanated from the original assessment. We endorse the findings rendered by the Tribunal in this regard. The Tribunal was right in holding that the CIT(A) should have confined himself to the additions made by the AO in his order dated 28.11.2014 under Section 40A(3) and for the deposits made in Karur Vysa Bank. Tribunal held that the grounds raised by the revenue in the appeal before it, on the issues other than two additions, do not arise from the assessment order and accordingly rejected the same and dismissed the appeal. The finding of the Tribunal does not call for any interference. Whether the additions under Section 40A(3) was warranted and after taking note of the factual matrix held that the assessee could demonstrate business expediency which justified the payment made in cash. We find no reasons to dislodge the factual findings recorded by the Tribunal. Cash deposit made in Karur Vysa Bank, the Tribunal after considering the factual position affirmed the order passed by the CIT(A) that it was proceeds of the deposits made by the assessee in the assessment year 2005-06 and the assessee had accounted accrued interest of ₹ 77,188/- and the assessee did not raise any ground citing violation of Rule 6DD. The revenue has not made out any grounds to interfere with the said findings of the Tribunal. Similar is the matter concerning the assessment year 2009- 10 - Assessing Officer made a fresh addition under Section 40A(3) on the cash payment for land purchase. The Tribunal noted that the Assessing Officer committed similar mistake as was done in the assessment year 2008- 09 in computing the income of the assessee and consequently held that the CIT(A) having set aside the original assessment, there was no question of adjudicating upon any of the grounds raised by the assessee relating to the original assessment. After rendering such finding, the Tribunal endorsed the view of the CIT(A) that the disallowance under Section 40(3) of the Act could not have been done since they were genuine payments done due to business expediency. Accordingly, the appeal filed by the Revenue challenging the order passed by the CIT(A) for the assessment year 2009-10 was also dismissed. Tribunal while dismissing the appeals filed by the Revenue for the assessment year 2008-09, the cross objections were allowed for the assessment year 2008-09 and allowed for the assessment year 2009-10. We hold that the revenue has not made out any ground to interfere with the orders passed by the Tribunal. For the above reasons, the appeals filed by the revenue are dismissed and the substantial questions of law are answered against the revenue.
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