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TMI Blog2018 (7) TMI 2038X X X X Extracts X X X X X X X X Extracts X X X X ..... ased country liquor and country spirit from the territorial licensee bottling plant IFB Agro Industries Ltd and payments in cash made thereto is protected by the exemption in terms of Rule 6DD(b) of Income Tax Rules, 1962 as per the notification issued by the Government. Government of Uttar Pradesh appointed M/s Saraya Distillery, Sadar Nagara, Gorakhpur, U.P. as its agent and the entire payments i.e. impugned amount paid to the said agent is to be treated as if paid to Government of U.P and as such said cash payment are covered by the Rule 6DD(b) of IT Rules, 1962. Therefore we are not in agreement with the view taken by Authorities Below and addition confirmed by CIT(A) is deleted - Decided in favour of assessee. - ITA No.2198-2199/K ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... iled written submissions and contended that the payments made in a single day and consolidated payment of several shops wherein the single payment bill or memo does not exceeds ₹20,000/-. The AO did not accept the said submissions made by the assessee and added an amount of ₹1,49,11,496/- to the total income of assessee on account of cash purchases for violation of provision of Section 40A(3) of the Act vide his order dated 17.10.2014 passed u/s 147/143(3) of the Act. 4. Before CIT(A) assessee reiterated the same submission that made before the AO. Further assessee contended that the purchases have been made from government authorized licencee and the payments are covered by exception under Rule 6DD(b) and Rule 6DD(k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee paid an amount of ₹ 2,33,23,967/- in cash to IFB Agro Industries Ltd and non production of any evidence showing that the said payments were made in account payee cheque or bank draft and for violation of the provisions of section 40A(3) of the Act, the aforesaid amount was brought to tax by the AO. Before the CIT(A) it was contended by the assessee that the cash payments were made to IFB Agro Industries Ltd, Panagarh Bazar, Budbud as per the compliances to be made with West Bengal Excise (supply of country spirit on payment of Duty) Rules, 2005 and it is a credit to the agent of the State Government and as such payments are covered by the exceptions contained in Rule 6DD (b) of Income Tax Rules, 1962. The ITAT, Kolkata benc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd ground No 5 6 are in general and do not survive for adjudication. 10. In the result, assessee s appeal is partly allowed. Coming to ITA No.2199Kol/2016 11. Ld. AR submits grounds raised in this appeal are similar to that of ITA No.2198/Kol/2016 on identical facts. On the contrary, Ld. DR has not controvert the same. Since main issue in ground No. 3 4 are discussed in afore-mentioned paragraph, we decide the issue in favour of assessee and we apply same ratio in this appeal also. Hence, grounds raised by assessee are allowed. 12. In the result, assessee s appeal is allowed partly. 13. In combine result, both appeal of assessee are allowed partly. Order pronounced in open c ..... X X X X Extracts X X X X X X X X Extracts X X X X
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