TMI Blog2022 (1) TMI 1051X X X X Extracts X X X X X X X X Extracts X X X X ..... Section 40A (3) of the Act was not practicable or would have caused genuine difficulty to the payee. In the case on hand, the tribunal has noted the fact and also taken a note of the contemporaneous documents produced by the assessee, namely, the sales tax bills, transport permits and other Government records to prove the genuineness of the transaction. Apart from that, the day-to-day stock register were also maintained which is noted in the tax audit report. Furthermore, the payments were made to the suppliers of the hides and skins and considering the nature of the trade, the [CIT(A)] and the tribunal agreed with stand taken by the assessee. Assessee placed reliance on the decision of this Court in Commissioner of Income Tax, Kolkat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rrect in holding that the purchases were made from the persons covered by the provisions of Rule 6DD(e) of the Income Tax Rules, without having any material on record to warrant and corroborate such view ? We have heard Mr. Debasish Choudhury, learned standing counsel appearing for the appellant/revenue and Mr. Sukalpa Seal, learned counsel appearing for the respondent/assessee. The assessing officer while computing the assessment by an order dated 14.3.2013 under Section 143(3) of the Act proposed to disallow the expenses which have been incurred by the assessee for the purchase of raw hides and skins by non-account payee cheques. The show cause notice was issued to the assessee, who had submitted the reply, stating that their case wou ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the Revenue filed appeal before the Tribunal. The Tribunal re-examined the factual position and noted that the assessing officer has not brought on record to prove the fact anything contrary except the observation that some of the notices sent under Section 133(6) of the Act have returned with postal endorsement not known . The tribunal observed that merely because some of the notices were returned with such endorsement, it cannot be inferred that the purchase was not made from producers. Furthermore, the tribunal noted that the assessee maintained dayto- day stock register of raw hides and skins and purchase of raw hides and skins were duly entered in the stock register. Furthermore, the tribunal noted that the there was no evidence avail ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... It will be clear from the provisions of section 40A (3) and rule 6DD that they are intended to regulate business transactions and to prevent the use of unaccounted money or reduce the chances to use black money for business transactions. From the above decision it is clear that the provisions of Section 40A(3) of the Act read with Rule 6DD of the Rules are intended to regulate business transaction and to prevent the use of unaccounted money. Further, it has been laid down that it is always open to the assessee to furnish documents to prove that the payment in the manner prescribed under Section 40A (3) of the Act was not practicable or would have caused genuine difficulty to the payee. In the case on hand, the tribunal has noted the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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