Subscription   Feedback   New User   Login      
Tax Management India .com
TMI - Tax Management India. Com
Articles Highlights TMI Notes SMS News Newsletters Calendar Imp. Links Database Experts Contact us More....
Extracts
Home List
← Previous Next →

Ellora Paper Mills Ltd. Versus Commissioner of Income Tax, Income Tax Officer, Ward 1 (1) , Mumbai

Addition u/s 40A - Tribunal applying Rule 6DD(j) to disallow the claim in respect of payments made in excess of ₹ 10,000/- in cash - Held that:- Where the head office or the place from where all the business operations are controlled or directed is a village or town which has a banking facilities, even such transporter would not be covered by Rule 6DD(h) of the Rules. Therefore, in the present case the benefit of Rule 6DD(h) was not available and could not be extended to the appellant-asse .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

the appellant-assessee was correctly denied by the Authorities under Section 40A(3) of the Act read with Rule 6DD(h) of the Rules. - Decided against assessee. - Income Tax Appeal No. 3 of 2002 - Dated:- 9-6-2017 - M.S. Sanklecha And Manish Pitale, JJ. Mr. N.S. Bhattad, Advocate for Appellant (Assessee) Mr. A.J. Bhoot, Advocate for Respondents JUDGMENT ( Per M.S. Sanklecha, J.) 1. This appeal from the order dated 18.08.2000 of the Income Tax Appellate Tribunal (Tribunal) under Section 260-A of t .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

d in law, the Tribunal was correct in applying Rule 6DD(j) of the Income Tax Rules,1962 (Rules) to disallow the claim of the appellant in respect of ₹ 21.37 lakhs in respect of payments made in excess of ₹ 10,000/- in cash? 3. This appeal relates to Assessment Year 1991-92. 4. The appellant has its factory at village Devada in Bhandara district. The village Devada has no banking facilities. In that view of the matter, the appellant had occasion to make cash payments to contractors, l .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ubmitted a Chartered Accountant s audit report which indicated the fact that village Devada is not served by the Bank and that the payment in excess of ₹ 10,000/- made in cash was exempted as it satisfied the condition under Rule 6DD(h) of the Rules in accord with the second proviso to Section 40A(3) of the Act. 5. By an assessment order dated 30.03.1993, the Assessing Officer held that the benefits of Rule 6DD(h) of the Rules would not be available to the appellant. This is so as it is av .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

n of Section 40A(3) of the Act as the Rule 6DD(h) and (j) of the Rules was not satisfied. Thus the assessment order dated 30.03.1993 added the aforesaid sum of ₹ 21.37 lakhs to the income of the appellant-assessee. 6. Being aggrieved, the appellant carried the issue in appeal to the Commissioner of Income Tax (Appeals) (CIT(A)). By an order dated 22.03.1995, CIT(A) dismissed the claim of the appellant while recording the fact that the appellant had failed to prove the genuineness of the pa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ssee to persons residing in village Devada were exempted from complying with Section 40A(3) of the Act by virtue of Rule 6DD(h) of the Rules. However, the payments which were made to transporters, contractors etc. who had business establishments at places outside the village Devada where banking facilities were available, were not entitled to the benefits of Rule 6DD(h) of the Rules. In these circumstances, the payments made to transporters, contractors, suppliers etc. was tested on the touchsto .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ing with the rival submissions, it would be useful to reproduce the statutory provisions and the Rules as in force during the subject assessment year, as under:- 40A(3) Where the assessee incurs any expenditure in respect of which payment is made, after such date (not being later than the 31st day of March, 1969) as may be specified in this behalf by the Central Government by notification in the Official Gazette, in a sum exceeding ten thousand rupees otherwise than by a crossed cheque drawn on .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

nk draft, the allowance originally made shall be deemed to have been wrongly made and the Assessing Officer may recompute the total income of the assessee for the previous year in which such liability was incurred and make the necessary amendment, and the provisions of Section 154 shall, so far as may be, apply thereto, the period of four years, specified in sub-section (7) of that section being reckoned from the end of the assessment year next following the previous year in which the payment wa .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ding ten thousand rupees may be made otherwise than by a crossed cheque drawn on a bank or by a crossed bank draft- No disallowance under sub-section (3) of section 40A shall be made where any payment in a sum exceeding ten thousand rupees is made otherwise than by a crossed cheque drawn on a bank or by a crossed bank draft in the cases and circumstances specified hereunder namely:- (a) …………….. (b) ……………. (c) ……& .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

ellip;………. (j) in any other case, where the assessee satisfies the Assessing Officer that the payment could not be made by a crossed cheque drawn on a bank or by a crossed bank draft (1) due to exceptional or unavoidable circumstances, or (2) because payment in the manner aforesaid was not practicable, or would have caused genuine difficulty to the payee, having regard to the nature of the transaction and the necessity for expeditious settlement thereof, and also furnishes e .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

blishment in the village, they were carrying on business in village Devada which did not have the facility of banking. Consequently these payments were also covered by Rule 6DD(h) of the Rules. (B) The impugned order has incorrectly invoked Rule 6DD(j) of the Rules to disallow the benefits of payments made in excess of ₹ 10,000/- in cash. This for the reason that Rule 6DD(j) is a residuary clause and would only apply when the payments made in cash are not covered by the earlier clauses. In .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

efers to the fact that wherever the genuineness of the payments were established, the benefit of Rule 6DD(j) of the Rules was made available to the appellantassessee. For the subject assessment year, the appellantassessee was not able to establish the genuineness of the payments of ₹ 21.37 lakhs made to transporters, contractors and suppliers of rice straw. Thus the benefit of exclusion from Section 40A(3) of the Act was rightly not extended by the Authorities under the Act. (B) Further th .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

f the appellant on touchstone of Rule 6DD(j) of the Rules. On the above test, the appellant had failed to establish the genuineness of the payments. Consequently no interference with the order of the Tribunal is called for and the substantial question be answered in favour of the respondent-Revenue. 11. We find that in terms of Section 40A(3) of the Act no expenditure would be allowed as a deduction, where the payment in excess of ₹ 10,000/- is made otherwise than by a crossed cheque drawn .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

by way of a crossed cheque drawn on a bank or by a crossed bank draft, are provided in Rule 6DD of the Rules. Therefore, only on satisfaction of the same, will such a payment be allowed. 12. In terms of Rule 6DD(h) of the Rules, a person who makes the payment in a village, which does not have the facility of banking, to a person who ordinarily resides therein or is carrying on business therein, will be allowed the benefit of deduction even when the expenditure is not paid by a crossed cheque dr .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

e Devada. 13. Mr. Bhattad, learned counsel for the applicantassessee states that the transporters, contractors and suppliers of rice straw who carried on business in village Devada, when the goods are supplied or taken from the appellant's factory premises. Therefore, the payment made in cash to such persons would be payments which are made to persons carrying on business under Rule 6DD(h) of the Rules. To our own mind the carrying on of business in the context of having banking facilities w .....

X X X X X X X

Extract - Part text only
Click here to Access Full Contents

X X X X X X X

 

 

 

 

 

what is new what is new
  ↓     Latest Happenings     ↓  

Forum: GST on RCM on rent in a unregistered state

Forum: COMPOSITION SCHEME

Article: Websites of Government Departments need lot of improvement. We are noticing detoriations in them for example, case of website of ITAT.

Highlight: Levy of additions tax u/s 115O on distribution of dividend - shares of its profits declared as distributable among the shareholders is not impressed with the character of the profit from which it reaches the hands of the shareholder - not to be bifurcated as agriculture and non-agriculture dividend - SC

Highlight: Rate of GST on old and scrap buses - 28% or 18% - at such initial tender process initiated by the Respondents-KSRTC, the present petitions filed by the petitioners are premature and misconceived and do not require any interference by this Court at this stage. - HC

Forum: Rent a cab operator

Highlight: In view of amendment made u/s 132A of the Income Tax Act, 1961 by Finance Act of 2017, the 'reason to believe' or 'reason to suspect', as the case may be, shall not be disclosed to any person or any authority or the Appellate Tribunal, SC dismissed the appeal of the assessee

Highlight: Validity of Assessment Order - period of limitation u/s 153 (2A) is applicable even if the entire order was not set aside but matter was remanded back for for limited aspects with directions - HC

News: Note ban was a shake-up, achieved its main objectives

Notification: Amendments in the notification No.5/2017- Integrated Tax (Rate) dated the 28th June, 2017.

Highlight: Levying interest u/s 234C - interest is to be charged on the returned income and not on assessed income.

Highlight: Accrual of income - sale of right to develop and sell incentive FSI under LOI - till the conditions of LOI are fulfilled transfer is not complete and income does not accrue to the assessee

Highlight: TPA - determination of ALP - TP adjustment by applying Bright Line Test (BLT) is not sustainable on protective basis having no statutory mandate.

Highlight: Safeguard Duty - Advance License Scheme - as there is no exemption from safeguard duty leviable under Section 8C, which is imposed on the goods imported from China, the importer has to pay safeguard duty

Highlight: Manufacture - process of cutting of waste plastic container - Such plastic containers before and after cutting are nothing but waste / scrap - Not a manufacturing activity as no new product emerges.

News: NITI Aayog and Govt. of Assam organizes workshop on health sector reforms in Guwahati; launches SATH- Sustainable Action for Transforming Human Capital

Notification: Seeks to amend notification no. 5/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding restriction of refund on corduroy fabrics

Notification: Seeks to amend notification no. 2/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst exemptions

Forum: GSTR 3B Rectification

Notification: seeks to exempt Skimmed milk powder, or concentrated milk

Notification: Seeks to amend notification no. 2/2017- integrated tax(rate) dated 28.06.2017 to give effect to GST council decisions regarding GST exemptions.

Forum: 3B mistake

Notification: Seeks to amend notification no. 1/2017- central tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst rates

Notification: Seeks to amend notification no. 1/2017- integrated tax(rate) dated 28.06.2017 to give effect to gst council decisions regarding gst rates.

Forum: GST - TRAN1 - filed - Data uploaded with Remarks Processed with Error - Not coming in Electronic credit ledger - need suggession guidance

News: Notification Issued For GST Actionable Claim On Branded Food Products

Highlight: Classification printed computer stationary/manifold Business Forms - to be classified under Chapter Heading 4820.00 or under Chapter Heading 4901.90 - items like A4 sheets, advertisement and job card to be classified under Chapter 49

Forum: GST Invoice

Article: RCM Applicability to persons not liable to get registered us 23(1)

Article: Credit of unsold stock [Section 140(3)] - Actual Credit as well as Notional Credit - Part-I - GST Transitional provisions

News: GST Refund - Blockage of Working Capital of Exporters - earlier also there was a normal blockage of funds for a period of 5-6 months at least

News: Clarification about Transition Credit - ₹ 1.27 lakh crore of credit of Central Excise and Service Tax was lying as closing balance as on 30th June, 2017 - claim of credit of ₹ 65,000 crore is not unexpected

Article: 20 Things You must know about E Way Bills in GST Law

Article: MISTAKES IN DRAFTING

Forum: Duty Drawback- Urgent

Highlight: The Customs and Central Excise Duties Drawback Rules, 2017 and All Industry Rates (AIRs) of Drawback related changes -reg. - Circular

Highlight: The definition of "subsidiary company" or "subsidiary" u/s 2(87) of the Companies Act, 2013 shall come into force w.e.f. 20-9-2017

Highlight: Central Government notified the All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017 - Notification

Notification: All Industry Rates of Duty Drawback Schedule w.e.f. 1.10.2017

Circular: Investment by Foreign Portfolio Investors in Corporate Debt Securities Review

Notification: Exemptions on supply of services under UTGST Act

Notification: Rates for supply of services under UTGST Act

Notification: Exemptions on supply of services under IGST Act

Notification: Rates for supply of services under IGST Act

Notification: List of Exempted supply of services under the CGST Act

Notification: Rates for supply of services under CGST Act

Highlight: Acceptance of deposits by companies from its members - conditions relaxed in case of Specified IFSC Public company and a private company - Rule 3 amended

Notification: Rate of exchange of conversion of the foreign currency with effect from 8th September, 2017

News: Tax Payers Advised To Confirm Identities Of Income Tax Search Authorities

Notification: Amendment in Appendix 3 (SCOMET items) to Schedule- 2 of ITC (HS) Classification of Export and Import Items 2012



|| Home || Acts and Rules || Notifications || Circulars || Schedules || Tariff || Forms || Case Laws || Manuals ||

|| About us || Contact us || Disclaimer || Terms of Use || Privacy Policy || TMI Database || Members || Site Map ||

© Taxmanagementindia.com [A unit of MS Knowledge Processing Pvt. Ltd.] All rights reserved.

Go to Mobile Version