TMI Blog2006 (7) TMI 149X X X X Extracts X X X X X X X X Extracts X X X X ..... - Dated:- 21-7-2006 - Judge(s) : R. GURURAJAN., JAWAD RAHIM. JUDGMENT The judgment of the court was delivered by R. GURURAJAN J.- The Revenue is before us in this appeal. The following three questions of law are raised: "(i) Whether the assessee is entitled to the relief claimed when he has not satisfied the conditions stipulated in section 40A(3) of the Act and rule 6DD(j) of the Rules? (ii) Whether it is mandatory on the part of the assessee to furnish evidence as to the genuineness of the payment and the identity of the payee which has admittedly not been done in the present case in order to claim exemption under section 40A(3) of the Act and rule 6DD(j) of the Rules? (iii) When admittedly the assessee had made payments throu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... A. B. Shanthi [2002] 255 ITR 258 (SC). Per contra, learned counsel for the assessee would say that this appeal has to be confined to the assessment years 1985-86 and 1986-87. He would also point out that after the orders of the Appellate Commissioner, the respondent has been granted the benefit of deletion of Rs. 83,767 for the assessment year 1986-87, and for the year 1985-86 the assessing authority has chosen to disallow the cash purchases to the extent of Rs. 1,50,307. He therefore says that though the Department got a case on the merits, even then according to him the appeal cannot be allowed in its entirety. After hearing, we have carefully perused the material on record. The assessing authority has passed three assessment orders ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ppeal as such was filed by the Revenue before the Tribunal with regard to the assessment year 1987-88. Even otherwise, the appellate order would show that only a direction was given to the Assessing Officer to verify the bills and allow according to the bills available with the appellant. Therefore, we are satisfied that this appeal has to be confined only to the assessment years 1985-86 and 1986-87. We have seen the orders passed by the authorities. It is seen that the assessee is engaged in scrap business. The Tribunal in the light of the order of the appellate authority notices section 40A(3) and also rule 6DD(j) of the Rules. After noticing the Tribunal has ruled that there is no doubt about the fact that in general the onus lies on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idharilal Goenka's case [1989] 179 ITR 122, the Calcutta High Court while propounding the view that the Assessing Officer has to take into account the surrounding circumstances, considerations of the nature of business, its exigency and other related facts while exercising his discretion held that there cannot be an exhaustive list of such circumstances falling within the purview of clause (j) of rule 6DD which can be uniformly applied." The apex court in Asst. Director of Inspection (Investigation) v. Kum.A. B. Shanthi [2002] 255 ITR 258 has chosen to notice with regard to the legislative powers in the matter of income-tax provision. The apex court ruled that the object of introducing section 269SS is to ensure that a taxpayer is not all ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... see was able to produce the vouchers to the extent of Rs. 83,767. Therefore he is entitled for the deletion to the extent of Rs. 83,767. Similarly, in terms of the subsequent order, we see that for the assessment year 1985-86 the cash transaction was to the extent of Rs. 1,50,307. Hence the Department has to take into account this as the basis for the purpose of tax. In the result, we deem it proper to accept this appeal in part. The proceedings pursuant to the assessment year 1986-87 are not interfered with in this order. In so far as the assessment year 1986-87 is concerned, we deem it proper to accept the transaction of Rs. 83,767 in the light of the supporting documentary evidence and with regard to the balance amount the Department i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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