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TMI Blog2020 (1) TMI 832X X X X Extracts X X X X X X X X Extracts X X X X ..... e nor is the money send through electronic mode and therefore such a transaction in my considered opinion cannot be covered by Rue 6DD(c)(v) of the Rules, 1962, and therefore benefit of the provision cannot be given to the petitioner. The petitioner also could not lead any evidence to show that he had deposited the amount on the instructions of M/s Jalan Synthetics or due to any business exigency. In absence of such evidence, the assessing authority rightly denied the benefit of exemption to the petitioner. The impugned order dated 19.01.2016, passed by the Principal Commissioner, Income Tax has considered the reply given by the petitioner and has concluded that in respect to the transfer of funds made by the petitioner, benefit of Rule 6DD of the Rules, 1962 is not attracted and therefore computation made by the assessing authority has been up held. The jurisdiction of writ Court in exercise of jurisdiction under Article 226 of the Constitution of India is limited to examining the decision making process and not the decision itself. This position of law has been constantly reiterated by the Hon ble Apex Court in its various pronouncements. See MUNICIPAL COUNCIL NEEMUCH VERSU ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... umar, Asif Ganj, Azamgarh and is engaged in the business of retail trading of ready made and other clothes in the name of the proprietary concern. For the assessment year 2008-09, the petitioner s firm filed income tax return which included income of ₹ 34,912/- earned from the house property besides business income of ₹ 1,70,304/-. The petitioner got his firm s accounts audited with net profit of ₹ 1,61,012/- showing @ 2.00% and gross profit of ₹ 8,67,837/- being 44.33% of the gross receipt. 4. It has been further submitted on behalf of petitioner that he disclosed about the advance given to supplier s account as well as copy of the account of M/s Jalan Synthetics, Varanasi before the assessing authority which clearly demonstrated that on various dates the amount of payment has been deposited by the petitioner in UBI, Varanasi bank on their instructions. It has further been contended that the assessing authority while passing the assessment order for the assessment year 2008- 09, did not raise any objection relating to the aggregate amount of ₹ 3,40,000/- deposited on various dates in the bank account of M/s Jalan Synthetics. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nt made to M/s Jalan Synthetics Ltd. is not covered by any exemption. The assessing authority had carried out only limited examination in good faith with respect to the genuineness of the party and believed the assessee and auditor. He has further stated that there is difference between a document and information and despite documents being on record it was on the basis of the fresh information that the petitioner has concealed his income in violation of Section 40A(3) of the Act, 1961. It was within the competence and jurisdiction of the authority to reopen the assessment under Section 148 of the Act, 1961 and therefore up held the order passed by the assessing authority. 11. Assailing the order of the Principal Commissioner, Income Tax, Gorakhpur, the petitioner has urged that the revenue has misinterpreted the provisions of Section 40A(3) of the Act and Rule 6DD of the Rules, 1962 and that the amount of ₹ 3,40,000/-, deposited on various dates in the bank account of M/s Jalan Synthetics, would be covered under Rule 6DD(c)(v) of the Rules, 1962 as the same has been done by use of electronic clearing system through the Bank. It is further submitted that th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... amount to change of opinion and therefore there was no infirmity in the same. 15. Heard learned counsel for the parties and perused the record. 16. The petitioner who carries on the business of retail trade in ready made and other clothes had given advance to the suppliers bank account i.e. M/s Jalan Synthetics while depositing total amount of ₹ 3,40,000/- on various dates between 12.06.2007 to 01.12.2007, in the UBI Bank, Varanasi in account no. 303505040010515. 17. In the return filed by the assessee he had declared that inadmissible expenses under Section 40A(3) of the Act read with Rule 6DD of the Rules, 1962 were nil and the same was also mentioned in the audit report. The assessing authority having no reason to disbelieve the aforesaid declaration made by the assessee, which was subsequently reopened in exercise of powers contained in Section 148 of the Act, 1947. The assessing authority, after giving opportunity of hearing to the assessee has made re-assessment by means of order dated 14.03.2014 and added ₹ 3,40,000/- in the income of the assessee. 18. The application was preferred by the petiti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... defined in section 2 of the State Bank of India (Subsidiary Banks) Act, 1959 (38 of 1959); (iii) any co-operative bank or land mortgage bank; (iv) any primary agricultural credit society or any primary credit society as defined under section 56 of the Banking Regulation Act, 1949 (10 of 1949); (v) the Life Insurance Corporation of India established under Section 3 of the Life Insurance Corporation Act, 1956 (31 of 1956); (b) where the payment is made to the Government and, under the rules framed by it, such payment is required to be made in legal tender; (c) where the payment is made by - (i) any letter of credit arrangements through a bank; (ii) a mail or telegraphic transfer through a bank; (iii) a book adjustment from any account in a bank to any other account in that or any other bank; (iv) a bill of exchange made payable only to a bank; (v) the use of electronic clearing system through a bank account; (vi) a credit card; (vii) a debit card. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tronic mode of transfer i.e. RTGS, IMPS, NEFT etc., where the funds are transferred through the bank account of one individual into the bank account of beneficiary through electronic means. When the funds are transferred through electronic clearing system then at least two banks or two branches of the same bank have to be involved then only the money is transferred through electronic clearing system between them. 26. In the present case, the question which arises for consideration is that in case, cash is deposited directly in the bank account of the beneficiary, can the benefit of Rule 6DD(c)(v) of the Rules, 1962, can be given to the assessee. Such transaction by depositing cash directly in the bank account of the beneficiary is not routed through any clearing house nor is the money send through electronic mode and therefore such a transaction in my considered opinion cannot be covered by Rue 6DD(c)(v) of the Rules, 1962, and therefore benefit of the provision cannot be given to the petitioner. The petitioner also could not lead any evidence to show that he had deposited the amount on the instructions of M/s Jalan Synthetics or due to any business exigency. In ab ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. Shortly put, the grounds upon which an administrative action is subject to control by judicial review can be classified as under: (i) Illegality : This means the decision-maker must understand correctly the law that regulates his decisionmaking power and must give effect to it. (ii) Irrationality, namely, Wednesbury unreasonableness. (iii) Procedural impropriety. The above are only the broad grounds but it does not rule out addition of further grounds in course of time. As a matter of fact, in R. v. Secy. of State for Home Department, ex p Brind [R. v. Secy. of State for Home Department, ex p Brind, (1991) 1 AC 696 : (1991) 2 WLR 588 (HL)] , Lord Diplock refers specifically to one development, namely, the possible recognition of the principle of proportionality. In all these cases, the test to be adopted is that the court should, consider whether something has gone wrong of a nature and degree which requires its intervention . 14. It could thus be seen that the scope of judicial review of an administrative action is very limited. Unless the Court comes to a conclusion tha ..... X X X X Extracts X X X X X X X X Extracts X X X X
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