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TMI Blog2012 (6) TMI 183X X X X Extracts X X X X X X X X Extracts X X X X ..... - Income Tax Appeal No. 191 of 2008 - - - Dated:- 3-5-2012 - Devi Prasad Singh And Saeed-Uz-Zaman Siddiqi, JJ. For Appellant : Mahendra Nath Tiwari For Respondent : D D Chopra JUDGEMENT 1. This is an appeal under section 260A of the Income Tax Act, 1961 against the judgment and order dated 31.7.2008 passed by Income Tax Appellate Tribunal, Lucknow Bench 'A', Lucknow In ITA No. 249 LUC/08. The dispute raised to assessment years 2004-2005. The appeal was admitted by a Division Bench vide order 20.01.2009 on the following substantial question of law, is reproduced as under: 1. Whether expenditure incurred by assessee though payment is not exceeding Rs. 20,000/-but multiple or fragmented payment is made in a day or short spa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... could have been done only by Cheque. Bills were supplied only up to rigors of Section 40A (3) of the Income Tax Act, 1961 (in short Act). The order passed by the Appellate Authority was also affirmed by a Tribunal. The Tribunal had made the observations as under, to reproduce:- "After hearing the learned Departmental representative on the point, who has vehemently opposed it, we have perused the list given at page 3 and we are of the opinion that the decision of the Hon'ble Orissa High Court squarely covers up the case of the assessee. As no single payment was more than Rs. 2,500, we hold that the dis-allowance under section 40A(3) of the said amount was not justified. We, therefore, delete the said addition." Heard the learned counse ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... express words. It is one of the well settled rules of interpretation that where a word used din a statute carries more than one meaning, that meaning which makes the provision workable and is nearest to the legislative intention, has to be adopted. The word 'sum' in section 40A(3), second proviso, of the Income-Tax Act, 1961, is used only to indicate an amount of money and does not refer to the totality of the expenditure." Against the said judgment of the Orissa High Court, a special appeal was preferred before the Apex Court and the said special appeal has been dismissed by the Apex Court as reported in (1983) 143 ITR (St.) 67 Learned standing counsel for the Department could not place any decision contrary to the above. Only submis ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... se than by a crossed cheque drawn on a bank or by a crossed bank draft, the allowance originally made shall be deemed to have been wrongly made and the [Assessing] Officer may recompute the total income of the assessee for the previous year in which such liability was incurred and make the necessary amendment, and the provisions of Section 154 shall, so far as may be, apply thereto, the period of four years specified in sub-section (7) of that section being reckoned from the end of the assessment year next following the previous year in which the payment was so made: Provided further that no dis-allowance under this subsection shall be made where any payment in a sum exceeding [twenty] thousand rupees is made otherwise than by a crossed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ported in 121 (1980) ITR 680, CIT Vs. Aloo Supply Co. 1989 . It is submitted that judgment of Aloo Supply Company (supra) has been affirmed by Hon'ble Supreme Court. 8. The Orissa High Court had interpreted words of the aforesaid provision and held that where the words used in the statute reflect more than one meaning, then that meaning which makes the provision workable and nearest to legislative intention has to be adopted. According to the Orissa High Court, the words used in Section 40A(3) of the second proviso of the Act indicate an amount of money and not the totality of expenditure. Accordingly, Orissa High Court directed that if assessee make payment at different time during the day and has no Idea totality of expenditure the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sus Triveniprasad Pannalal [1997] 228 ITR 680. Identical view has been taken in CIT versus Kothari Sanitation and Tiles Pvt. Ltd. [2006] 282 ITR 117 (Mad). It was further pointed out that similar view was taken by the Orissa High Court in CIT versus Aloo Supply Co. [1980] 121 ITR 680. The relevant portion of the said judgment is reproduced below (headnote): "The word 'sum' has no statutory definition and must have the common parlance meaning. While legislating, Parliament tries to convey its intention through express words. It is one of the well settled rules of interpretation that where a word used din a statute carries more than one meaning, that meaning which makes the provision workable and is nearest to the legislative intention , ..... X X X X Extracts X X X X X X X X Extracts X X X X
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