9911796707
TMI Blog2015 (2) TMI 9X X X X Extracts X X X X X X X X Extracts X X X X ..... isallowance of Rs. 3,12,300/- on account of freight and lorry hire charges. 4. The brief facts of the case are that, the assessee was engaged in the business of booking parcels cargoes and luggage of the public in general and to act as carrier of goods. During the course of assessment proceedings, it was noted by the Assessing Officer that the balance sheet of the assessee reflected M/s. Sarvodaya Road Lines as a creditor for Rs. 72,418/-. The assessee had claimed that total freight and lorry hire charges of Rs. 3,12,300/- was paid to the said M/s. Sarvodaya Road Lines. The assessee was asked to furnish the address of the said party and notice under section 133(6) of the Act was issued at the address provided by the assessee. The notice was sent for service through the Inspector of the office of the Assessing Officer who in turn, reported that no such person existed at the given address. The assessee failed to furnish any confirmation of either the said party or the PAN number of the said party. The assessee was asked to prove the identity, credit worthiness of the transaction held with the said party. In respect of the genuineness of the transaction, the assessee furnished the co ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... filed the confirmation from the said party nor the said party was produced for verification. The Assessing Officer had issued notice under section 133(6) of the Act at the address provided by the assessee, which could not be served as the said party was not available at the said address. In such circumstances, the onus was upon the assessee to explain that the transaction was genuine. The assessee claims that the said creditor had left the address and was not traceable. However, lorry received by the consignee, the progress note, weigh bridge slip, wherein the details of truck number was mentioned in the progress note of M/s. Sarvodaya Road Lines along with sale bills raised on the customers were filed before the Assessing Officer and also before the CIT(A). The assessee has furnished on record the ledger account of M/s. Sarvodaya Road Lines for the captioned assessment year at page 214 of the Paper Book. As against the lorry charges of Rs. 62,500, 64,100/-, 59,100/- and 64,600/-, all booked on 09.07.2008, payment in cash has been made in the range of Rs. 10,000/- to Rs. 20,000/- from 09.07.2008 to 13.07.2008. Thereafter, on 12.02.2008, there are lorry hire charges of Rs. 19,000/- ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed as the same were in contravention to provisions of section 40A(3) of the Act which were amended from the assessment year 2009-10. In reply, the assessee explained that the TDS was deducted at source in the name of brokers who never owned any goods hired by the assessee. The Assessing Officer rejecting the plea of the assessee observed that the classification of sub-contractors or agents was a afterthought and the payments made by vouchers were below Rs. 20,000/- each at different times during a day. However, when the amended provisions of law were brought to the notice of the assessee then, he changed his plea that the persons were acting as commission agents in between the assessee and vehicle owner. The Assessing Officer also took note of the statement of director of the assessee company recorded during survey action under section 133A of the Act carried on 24.03.2010, in which, he explained that the payments made in cash were advance lorry hire charges. In the said statement, nowhere he had mentioned that the persons receiving the payments were commission agents. The plea of the assessee that the cash payments were covered under Rule 6DD(k) of Income Tax Rules was also reject ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing the said payments in cash in a day exceeding Rs. 20,000/-. However, the plea of the assessee is that it had not violated the provisions of section 40A(3) of the Act since it was covered by the exceptions provided under Rule 6DD of the Rules in particular clause (k) to Rule 6DD of the Rules. 16. Under Rule 6DD of the Rules, cases and circumstances in which payments or aggregate payments exceeding Rs. 20,000/- in a day may be made to a person otherwise than a account payee cheque or account payee draft are provided. Under clause (k) to Rule 6DD of the Rules, it is provided that where the payment was required to be made by any person to his agent who is required to make payment in cash for goods or services on behalf of such person, then, even where the payment has been made in cash exceeding Rs. 20,000/- in a day, then, no disallowance shall be made under section 40A(3) of the Act. 17. Now, coming to the facts of the case, the assessee has made the cash payments in excess of Rs. 20,000/- in a day. The plea of the assessee before us is that such payments have been made to the commission agent, who had provided the trucks / lorries to the assessee for transport of its goods and e ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
