TMI Blog2002 (1) TMI 1303X X X X Extracts X X X X X X X X Extracts X X X X ..... k basis. During the course of assessment proceedings, the Assessing Officer found that assessee had made payments to the labour contractors aggregating in all ₹ 1,52,956 in cash which is in violation of provisions contained in section 40A(3) of the Act. The Assessing Officer rejected the explanation of the assessee that the assessee did not come within the clutches of section 40A(3) of the Act in view of the decision of Orissa High Court in the case of CIT v. Aloo Supply Co. [1980] reported in 121 ITR 680 . In this decision, it has been held that where payment ex ceeding ₹ 10,000 were made at a time during the course of the day, the provisions contained in section 40A(3) are attracted and not otherwise. In the assessment order, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 6-11-1988 ₹ 15,576 (C)Mr. Durlabhbhai Purshottamdas (5,000 + 7,403) 8-9-1999 ₹ 12,403 (6,719 + 5,000) 7-10-1988 ₹ 11,719 (6,000 + 6,000) 22-10-1988 ₹ 12,000 (6,140 + 6,000) 6-11-1988 ₹ 12,140 ₹ 1,37,956 Continuing his argument counsel of the assessee submitted that labour contractor is required to make payment to the labourers in cash. 6-11-1988 was Sunday, the ban ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as camouflage to evade tax by showing fictitious or false transactions. Where the authorities are satisfied about the genuineness of the transaction and the identity of the payee, there would be no occasion to disallow such kind of payment in the circumstances of acute financial stringency. The Hon ble Gauhati High Court in the case of Walford Transport (Eastern India) Ltd. v. CIT [1999] reported in 240 ITR 902 (Gau.) held that where the transaction is found to be genuine and the identity of the payee is established a liberal view of compelling and mitigating circumstances should be taken. In the case before us assessee had made the payment to labour contractor and no single payment is exceeding ₹ 10,000. It is well known that labour ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
