M/S. NEW PANJABI SAMRAT,KOLKATA vs. ITO, WARD - 49(2), KOLKATA, KOLKATA

The assessee in the present case is a partnership firm, which is engaged in the business of trading of Punjabi and Pyjama. The return of income for the year under consideration was filed by it on 31.10.2006

The disallowance made by the Assessing Officer under section 40A(3) of the Act was challenged by the assessee in an appeal filed before the ld. CIT(Appeals). During the course of appellate proceedings before the ld. CIT(Appeals), copies of bills for purchases made from Howrah Hut were produced by the assessee and a request was made for admission of the same as additional evidence on the ground that the same could not be produced before the Assessing Officer as the file containing the said bills was not traceable at the relevant time. The ld. CIT(Appeals) admitted the purchase bills filed by the assessee as additional evidence and forwarded the same to the Assessing Officer for his verification and comments. In the remand report submitted to the ld. CIT(Appeals), the Assessing Officer stated that in the absence of names and addresses reflected in the purchase bills, the same were not open for verification. Before the ld. CIT(Appeals), it was also submitted on behalf of the assessee that all the payments against purchases in cash were made in amounts less than Rs.20,000/- each to different persons and, therefore, the provisions of section 40A(3) were not applicable. The ld. CIT(Appeals) did not find

At the outset, it is noted that there is a delay of one day on the part of the assessee in filing this appeal before the Tribunal. In this regard, the assessee has filed an application seeking condonation of the said delay and keeping in view the reasons given therein, we are satisfied that there was sufficient cause for the delay of one day on the part of the asseessee in filing the present appeal before the Tribunal. We, therefore, condone the said delay and proceed to dispose of this appeal of the assessee on merit after considering the submissions made by both the sides and perusing the relevant material on record. The limited contention raised by the ld. Counsel for the assessee is that the purchase bills produced by the assessee before the ld. CIT(Appeals) were sufficient to show that none of the payments against purchases made from Howrah Hut was in excess of Rs.20,000/- in any instance. He has contended that the relevant entries made in the cash book of the assessee can corroborate this position but neither the Assessing Officer during the remand proceedings nor the ld. CIT(Appeals) during the course of appellate proceedings has given proper and sufficient opportunity to the assessee to support and substantiate its case. He has contended that this matter may, therefore, be restored to the file of the Assessing Officer in order to give such opportunity to the assessee to establish that the payments made in cash against the purchases made from Howrah Hut are not hit by the provisions of section 40A(3). The ld. D.R. has not raised any objection for giving such opportunity to the assessee. We, therefore, set aside the impugned order of the ld. CIT(Appeals) on this issue and restore the matter to the file of the Assessing Officer for deciding the same afresh after giving the assessee proper and sufficient opportunity to establish

In the result, the appeal of the assessee is treated as allowed for statistical purposes. Order pronounced in the open Court on November 20, 2015. Sd/- Sd/-