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TMI Blog2020 (12) TMI 462X X X X Extracts X X X X X X X X Extracts X X X X ..... ual who is engaged in construction business. The return of income for the year under consideration was filed by him on 26-10-2007 declaring total income of Rs. 5,49,408/-. During the course of assessment proceedings, it was noticed by the Assessing Officer from the verification of bank statements of the assessee that certain payments were made in cash exceeding Rs. 20,000/- aggregating to Rs. 40,85,825/-. Since the said payments were made in cash in contravention of provisions of section 40A(3) of the Act, the assessee was called upon by the Assessing Officer to offer his explanation in the matter. In reply, it was submitted on behalf of the assessee that majority of the amounts were withdrawn from bank for day-today expenses and the same w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring the remand proceedings and in the absence of the same, explanation offered by the assessee was not verifiable. Keeping in view this comment made by the Assessing Officer in the remand report, the ld. CIT(A) upheld the action of Assessing Officer in invoking the provisions of section 40A(3) of the Act and confirmed the disallowance of Rs. 8,17,165/- made by the Assessing Officer. 6. I have heard the arguments of both sides and perused the material available on record. It is observed that a detailed submission was filed by the assessee before the ld. CIT(A) in support of its case that the provisions of section 40A(3) of the Act were not applicable to the entire cash withdrawals/payments made by him during the year under consideration. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ssee in this regard, he has finally submitted the matter can be sent back to the Assessing Officer for proper verification if the assessee undertakes to produce the cash book and other evidence to support and substantiate his explanation in the matter. Since the ld. counsel for the assessee has undertaken to produce the cash book and other evidence to support and substantiate the case of assessee on this issue, I consider it fair and proper and in the interest of justice to set aside the impugned order of ld. CIT(A) on this issue and remit the matter to the file of Assessing Officer for deciding the same afresh after verifying the explanation of the assessee from the relevant record including especially the cash book and other evidences whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the total receipts and increase in work-in-progress. Keeping in view this position, the ld. CIT(A) restricted the disallowance of 15% made by the Assessing Officer out of wages to 7%, thereby sustaining the disallowance of Rs. 4,51,913/- made by the Assessing Officer out of wages to Rs. 2,25,956/-. 11. I have heard the arguments of both sides on this issue and perused the material available on record. It is observed that the claim made by the assessee on account of wages was not fully supported by the documentary evidence and even the ld. counsel for the assessee has not been able to bring anything on record to rebut or controvert the finding recorded by the Assessing Officer as well as ld. CIT(A) to this effect. At the same time, it is o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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