2010 (10) TMI 575

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..... y tax payable in terms of the above provision on the payment to transport contractors - Decided against the assessee - 320, 324, 325, 328, 339 of 2010 - - - Dated:- 15-10-2010 - RAMACHANDRAN NAIR C. N., SURENDRA MOHAN K., JJ. JUDGMENT C. N. Ramachandran Nair J.- 1. There is only one question raised in all the connected appeals filed by the very same assessee for the assessment years 2000-01 to 2006-07, that is about the validity of the suo motu revisional order issued by the Commissioner of Income-tax under section 263 of the Income-tax Act, 1961. We have heard Sri T. M. Sreedharan, counsel appearing for the appellant-assessee and have gone through the orders of the Tribunal and that of the Commissioner of Income tax. 2. .....

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..... case of the assessee is that clause (c) to the Explanation to section 263(1) applies to his case. However, the Tribunal after verifying the records found that the Assessing Officer did not in fact consider the disallowance under section 40A(3) for the purchases made by the assessee against cash payments. The finding of the Commissioner of Income-tax (Appeals) is also to the effect that the issue does not arise from the assessment orders because the Assessing Officer has not made any disallowance. Admittedly, the assessee was engaged in purchase of rice and the purchases are made against cash payments which attract section 40A(3) of the Act. In fact exemption available under rule 6DD(a) is only for purchase of agricultural produce and since .....

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..... Assessing Officer based on the orders of the Commissioner under section 263, the assessee can produce proof and claim eligible benefit under the provisions of the Act and Rules. We, therefore, leave it to the assessee to claim exemption or exclusion against disallowance of cash purchases permissible under law. 5. So far as the validity of the orders issued under section 263 for considering the disallowance under section 40(a)(ia) also we feel the finding of the Tribunal is correct because the basis adopted by the Tribunal for upholding section 263 order in the case of section 40A(3) applies to this case as well inasmuch as the assessee has not deducted any tax payable in terms of the above provision on the payment to transport contract .....

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