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TMI Blog2020 (10) TMI 303X X X X Extracts X X X X X X X X Extracts X X X X ..... yal [ 1995 (3) TMI 3 - SUPREME COURT ] the explanations in the context of Section 68 of the Income Tax Act have to be considered in the light of human probabilities and the explanations cannot be unreasonably rejected. Thus, the decision in Sumati Dayal (supra), to a certain extent, supports the case of the Assessee rather than the Revenue. The decision in Killick Nixon Ltd. [ 2012 (3) TMI 175 - BOMBAY HIGH COURT ] turns on its peculiar facts where there were concurrent finding of fact that the transaction in question was a sham and not genuine transaction. In these circumstances, it was held that there was no question of law to be considered. In the present case, there are concurrent findings of fact. Since no case of perversity has been m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... points out that in the facts and circumstances of the present case, the provisions of Section 35E of the Income Tax Act, were not at all applicable. In any case, she points out that the findings recorded by the Commissioner of Income-tax (CIT) (Appeals) and the Income Tax Appellate Tribunal (ITAT) that an amount of ₹ 5,00,00,000/- paid by the Assessee to the mining lessees constitutes revenue expenditure, are vitiated by total perversity. She points out that this amount of ₹ 5,00,00,000/- was towards obtaining right to mine and, therefore, this amount, under no circumstances, could be regarded as any revenue expenditure. She points out that the works like building of roads, offices, etc. had already been undertaken by the minin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ioner of Income-tax, Panaji, Goa vs. Zuari Industries Ltd. [2020] 115 taxmann.com 337 (Bombay); (II) Sumati Dayal vs. Commissioner of Income-tax [1995] 80 TAXMAN 89 (SC); and (III) Killick Nixon Ltd. vs. Deputy Commissioner of Income, Central Circle (3) [2012] 20 taxmann.com 703 (Bom.). 7. Mr. Rao, the learned Counsel for the Respondent points out that since the substantial questions of law at paragraph 5.A and 5.B were never framed by this Court at the time of admission of the Appeal, the same are deemed to have been rejected. In any case, he points out that the issues now raised by the Revenue, are the issues in respect of which there are concurrent findings recorded by the CIT(Appeals) and the ITAT. He points out that such concurrent fin ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xtracted ore with the mining lessees. Both, the CIT (Appeals), as well as the ITAT, have examined, in some details, the scope of the agreement between the parties, as well as the nature of this payment of ₹ 5,00,00,000/-. 12. Both, the CIT (Appeals), as well as the ITAT, concurrently held that in view of the agreement and the transactions between the parties, the provisions of Section 35E of the Income Tax Act, were indeed attracted. Consequent thereof, some benefits have been extended to the Assessee. In fact, the benefit extended to the Assessee is much lesser than what was applied for by the Assessee. This is on the basis of a correct reading of the provisions in Section 35E of the Income Tax Act. 13. Therefore, this is basically t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng from the record, were also required to be taken into consideration by the AO for deciding whether the explanation offered by the Assessee deserved acceptance. 16. Both, the CIT (Appeals) as well as the ITAT, held that the Assessee in this case had offered explanation as to why two entities or their proprietors could not give any statement in these proceedings. The two authorities have pointed out that the payments were made to these two entities by cheques. The two authorities have also pointed out that even the Revenue has accepted that the purchases were made by the Assessee from such entities and it is in respect of such purchases that the Assessee made payments to the said parties. Therefore, by taking into consideration these aspect ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e. The Hon'ble Supreme Court has further held that while considering the explanation of the Assessee, the department cannot, however, act unreasonably and the matter has to be considered in the light of human probabilities. 20. In this case, as noted earlier, both the CIT (Appeals), as well as the ITAT have considered the explanation offered by the Assessee in the light of several circumstances to which they have adverted to. Upon consideration of such several circumstances borne out from the record, the two authorities have concurrently held that the explanation offered by the Assessee was more than probabilized. These are concurrent findings of fact. Besides, as held by the Hon'ble Supreme Court in Sumati Dayal (supra), the explan ..... X X X X Extracts X X X X X X X X Extracts X X X X
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