TMI Blog2022 (3) TMI 1245X X X X Extracts X X X X X X X X Extracts X X X X ..... es have been debited to the profit and loss account and the entire source of purchases are duly recorded in the books of account thus source of such purchase/expenditure stands established as having been incurred out of the funds shown in the books of account. ITAT further held that therefore at the threshold, addition u/s 69C cannot be resorted to - ITAT further inter alia held that the nature of business of the assessee and modus operandi for milk tanki purchases has to be understood. ITAT noted that since the purchase of such a huge quantity of milk is from a large number of farmers and individuals, it is very difficult to make an individual account of each and every farmer who comes from nearby villages with their milk production to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... only on a substantial question of law. A bare perusal of Section 260A of the Income Tax Act makes it clear that the appeal is permissible in the High Court only if there involves a substantial question of law. The necessary corollary of Section 260A would be that the Income Tax Appellate Tribunal is the final arbiter of facts. The appeal before the High Court would be entertained only if it involves a substantial question of law. The object and purpose of establishing the ITAT would be defeated if the facts are agitated before the High Court also - ITA 50/2022 - - - Dated:- 15-3-2022 - HON'BLE MR. JUSTICE MANMOHAN AND HON'BLE MR. JUSTICE DINESH KUMAR SHARMA Appellant Through: Mr. Sanjay Kumar and Ms. Esha Kadian, Standi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nies on 28.02.2014 at various premises. The assessee is manufacturer and exporter of Milk and Milk products i.e. Skimmed Milk Powder, Full Cream Milk Powder, Dairy Whitener, Milk Fact, Paneer etc. During the course of assessment on the basis of seized documents, the Assessing Officer noticed that the assessee had made huge cash purchases from traders (other than farmers) under the head Milk Purchase Tanki and such purchases amounting to ₹ 23,03,77,859/- in violation of Section 40A(3) of the Act. 4. Learned counsel for the appellant has stated that since the assessing officer failed to furnish the identity and addresses of such Tanki traders, the Assessing Officer rightly held that the genuineness of such purchase parties remained ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uge purchases from the vendors making so-called Tanki Milk Supplies in cash is not justifiable. 6. In the backdrop, the initial assessment order was passed on 29.12.2017 by the Assistant Commissioner of Income Tax. In his order, the assessing officer has inter alia held that the assessee had failed to provide the contact number of farmers and therefore it was not feasible to verify, whether the purchases under the different heads of the ledger in which milk is being done from farmers only. The assessing officer concluded that the purchases under the head Milk Purchase Tanki‟ is being made in cash and that too from the traders and not from farmers which is gross violation of Section 40A(3) of the Act, 1961. The assessee challenged ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make an individual account of each and every farmer who comes from nearby villages with their milk production to the assessee's factories to sell their milk. 8. The tribunal acknowledged the fact that the assessee keeps the records of the person/farmer of each village who collects all the milk and send the same to the assessee's factory and common entry of purchase in the books of account is made in order to avoid multiple of hundreds of ledgers. The tribunal has also noted in the order that the assessee duly maintains other records i.e. when the milk is received at the factory gate, its weight/ quantity is taken and is then tested for quality; a quality slip is generated which contains the details of the milk including gross wei ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arties or it is of general public importance, it is an open question in the sense that the issue has not been settled by a pronouncement of the Court or it is not free from difficulty or it calls for a discussion for alternate views. A High Court under Section 260A of the Act has limited jurisdiction to interfere with findings of fact recorded by the Tribunal. If findings of Tribunal are irrational, perverse or unreasonable, then only interference of the court would be justified. It would also be justified if a finding of fact is arrived at by the Tribunal without any evidence. Section 260A is akin to Section 100 of the CPC, 1908.[See: Sampath Iyengar's Law of Income Tax]. 10. In the judgment of Goodyear India Ltd. v CIT 2000 SCC ..... X X X X Extracts X X X X X X X X Extracts X X X X
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