Home Case Index All Cases Income Tax Income Tax + AT Income Tax - 2017 (6) TMI AT This
Forgot password New User/ Regiser ⇒ Register to get Live Demo
2017 (6) TMI 1154 - ITAT JAIPURAddition u/s 40A - Held that:- As per the terms of the contract, the amount has to be paid on the same day and given that there was no evening branch of any bank at Bayana, the assessee was left with no option but to make payment in cash and hence the case of the assessee is covered under Rule 6DD(g) of the Income Tax Rules. On perusal of the said rules, it is provided therein that where the payment is made in a village or town which on the date of such payment is not served by any bank to any person who ordinarily resides or is carrying on any business profession or auction in any such village or town, it shall be considered as an exceptional circumstance for making the cash payment. CIT(A) has given a finding that both the buyer and seller are functioning in an area where ample banking facilities are available. The said finding has not been controverted by the assessee. Further, the Rules provides that on the date of payment, the place where the payment is made is not served by any bank. The Rules however have not provided for a situation as in the instant case where even though the place is served by the bank but at the relevant point in time (evening) when the payment is made, whether the place is served by the bank or not. In absence of the same, we are unable to accede to the contention of the ld. AR in respect of payment amounting to ₹ 2,13,314/- covered under Rule 6DD (g) of the Income Tax Rules. Accordingly, the assessee deserves relief to the extent of only ₹ 79,392/-. Addition on profit earned on unaccounted sales - Held that:- Assessing Officer has worked out the unaccounted sale based on the impounded papers which clearly show the quantity of the material, rate, date & name of the party. Therefore, the contention of the ld. AR that these were rough estimates cannot be accepted and we accordingly confirmed the unaccounted sales as worked out by the Assessing Officer at ₹ 13,37,586/-. Regarding estimation of GP rate on the unaccounted sales, the ld. CIT(A) has applied the GP rate which is otherwise offered by the assessee herself in respect of accounted sales recorded in the books of accounts for the year under consideration. Where the GP rate of the same year is available, there is no justification for applying the average GP rate for last 3 years as done by the Assessing Officer. We accordingly, confirmed the action of the ld. CIT(A) in confirming the profit earned on unaccounted sales amounting to ₹ 4,14,652/-.
|