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TMI Blog2021 (12) TMI 1192X X X X Extracts X X X X X X X X Extracts X X X X ..... ng significant changes with effect from assessment year 2009-10, which is subject assessment year in the present case. We find one more reason as recorded by ld CIT(A) that during the first round of appeal before the Tribunal, of the assessee took his stand that assessee has not made payment exceeding of ₹ 20,000/- or aggregate of exceed of ₹ 20,000/- in order to attract the provision of section 40A(3) - The assessee instead of substantiating that submission raised a new plea by taking the excuse of alleged conditions No.6 and 17, allegedly printed on back side of bill of transporter. No such copy of bill is produced for our perusal. In aforesaid circumstances, we do not find any justification to interfere with the order of Ld. CIT(A). In the result, the ground of appeal raised by the assessee is dismissed. Disallowance of deduction u/s 80P(2)(a)(iii) - No new facts are required to adjudicate the additional grounds of appeal. The assessee in facts seeking deduction under different clauses of section 80P(2)(a) only. In our view, the assessee has right to raise new claim in additional ground of appeal before the appellate authority as has been held by series of de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ct, 1961 (in short the Act ) by making disallowance under section 40A(3) of ₹ 1,01,650/- on account of payment made to transporters in cash in excess of ₹ 20,000/- in day. On appeal before the Ld. CIT(A) the disallowance was upheld in order dated 07.11.2012.Further aggrieved the assessee filed before the Tribunal. The Tribunal restored the matter back to the Assessing Officer to decide the issue de novo. 3. In the de novo proceedings, the Assessing Officer noted that assessee purchased fire crackers from Shivkashi and made payment for transportation. The assessee was asked to furnish the receipt of transportation and voucher thereof. On perusal of such receipt and voucher, the Assessing Officer noted that payments to transporter was made in cash on different dates in the month of August and October, as recorded in para-3 of assessment order. The Assessing Officer further noted that before Tribunal the assessee stated that the assessee has not made payment exceeding ₹ 20,000/- on aggregate, in order to attract the provision of section 40A(3) of the Act. On making such submission, the case was remitted back to the file of Assessing Officer to examine such facts. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Factory 290 Total 22,400 5. On the basis of aforesaid summary, the Assessing Officer again issued show cause notice dated 16.10.2014. In the said show cause notice, the Assessing Officer recorded that assessee has paid transport expenses to Jayalakhmi Transport in cash of more than ₹ 20,000/- for transport expenses in a single day and asked as to why the amount of ₹ 1,01,650/- should not be added to the total income of assessee. The assessee filed its reply dated 20.10.2014. In reply, assessee stated that as per conditions No.6 17 printed on the back side of transport bill, the delivery of goods was required to be taken within seven days from the date of receipt of the goods at destination, failing which normal demurrage at 10 paisa per article per day was chargeable. Thus, the condition specified that if the transporters are not paid their charges the recipient (assessee) is liable to pay demurrage charges. Further condition No.17 states that further charges if not paid or payable at the time of delivery the company (transporter) has lien on the goods carry for freight and further charges not ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee is showing good turnover as well as profit on sale of cracker. The assessee is not a general business. The assessee-society running its activity under the control of State Government, Board, Select Committee, who are not having vested interest. The books of assessee are audited by State Government and internal auditors as well as by independent auditor. The Ld. AR for the assessee further submits that as per the condition printed on back side of transport bills, there was two significant conditions i.e. condition No. 6 and 17. As per condition No.6,if the delivery of goods is not received by consignee within seven days from the date of receipt of goods at the destination, demurrage charges, was payable at the time of delivery of goods, this was one of the reason for making cash payment. Further, as per condition No.17, if the freight charges and other charges are not paid at the time of delivery, the transporter has lien on the goods carried on freight and other charges, which if not paid. This was one other reason to make cash payment. 8. The ld.AR for the assessee further states that genuineness of payment is not doubted. Out of more than ₹ 1.00 crore only &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ertain conditions printed condition on the back side of bills of transporter, wherein in case of delay in delivery, the assessee was liable to pay demurrage charges. On both the submission, we have given our thoughtful consideration. On considering the first submission, that genuineness of the expenses is not doubted, we find that here the issue before us is whether the assessee has reasonable cause in making payment in cash of more than ₹ 20,000/- in a day or not. Similarly on the second submission that the assessee was compelled by the conditions No.6 and 17 printed on back side of bill of transporter. We find that the assessee has not disclosed the fact as to when the consignment reached at the destination and when the deliveries of goods were received by assessee. No such expediencies are disclosed by the assessee that either transporter insisted for cash payment or the assessee was unable to prepare the cheque against such delivery immediately. Further it is not the case of assessee that the assessee was maintaining the bank account in co-operative Bank and realisation of cheque from their banker take a longer time. In our view the case law relied by Ld. AR of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at on verification of Audit report, it was noticed that assessee claimed deduction of ₹ 4,02,379/- under section 80P(2)(a)(iii) of the Act. As per provision of 80P(2)(a)(iii), the assessee is not eligible for such deduction. The Assessing Officer after serving statutory notice proceedings proceeded for reassessment and issued show cause notice for disallowing the same. The contents of show cause notice extracted in para-6 of the assessment order. In response to show cause notice, the assessee filed its reply dated 18.09.2015. In the reply the assessee contended that sub-clause of (iii) of sub-section (2) of section 80P, provides deduction to co-operative societies engaged in the business of marketing of agricultural produce grown by its members. The assessee claimed deduction on the certain following income:- Particulars Amount (Rs) Interest Sabhasad Mal Karaj ₹ 3,17,614 Interest on Shak Fal Karaj ₹ 17,474 Interest tractor Khedankharaj ₹ 58,515 Interest Kamachari Mal Karaj ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eed and other items and not for sale of their produce. The deduction is qua the specific nature of activity from which the assessee-society earned its income not qua the activities of the society. The Ld. CIT(A) held that there is no dispute between assessee and the Assessing Officer that assessee-society intends to avail deduction under section 80P(2)(a)(iii) of the Act on non-eligible activities. The sub-clause (iii) of clause (a) of sub-section (2) of section 80P(2) prescribed that income / gains attributable to marketing of agricultural produce grown by its members . Thus, on plain reading of it, there is no ambiguity about the provision, which needs to be literally interpreted. Thus, ld. CIT(A) also rejected alternate contention of the assessee that assessee is not eligible on alternative plea. Aggrieved by the order of ld CIT(A) in confirming the addition/ disallowance of deduction claimed under section 80P(2)(a)(iii), the assessee has filed present appeal before this Tribunal. 19. We have heard the submission of the Ld. AR for the assessee and the Ld. Sr. DR for the Revenue and have gone through the order of authorities below. The Ld. AR of the assessee submits that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ty by mere consent but only on condition precedent for the exercise of jurisdiction being fulfilled. If the jurisdiction cannot be afford by consent, there would be no question of existence or estoppels or the bar of res judicata being attracted because in such case, would enhance jurisdiction unless precedent condition and it would be a void order of enacting. The ld. AR of the assessee on the merit of additional ground of appeal submits that the claim of assessee clearly falls under 80P(2)(a)(i) or (iv) and the assessee is alternatively eligible for deduction under the respective subclause of clause (a) sub-section 80P. 24. We have considered the rival submission of both the parties and perused the order of lower authorities. We have also deliberated on the case law relied by the ld. AR of the assessee. We find that the Assessing Officer disallowed the deduction of income on different items of income claimed under section 80P(2)(a)(iii) by taking view that assessee is not eligible for such deduction and has made a wrong claim. The Ld. CIT(A) upheld the order of Assessing Officer taking view that during the assessment proceedings for assessment year 2010-11, similar deduction w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erred in confirming the disallowance u/s 80P(2)(a)(iii) of the Act of ₹ 5,34,396/- (2) That on facts and in law, the leaned CIT(A) has grievously erred in confirming the disallowance of ₹ 96,700/- made u/s 40A(3) of the Act. (3) That on facts, and evidence on record, the entire disallowances ought to have been deleted as prayed for. 29. Further vide application dated 03.08.2021 the assessee has raised the following additional ground:- 1. That on facts and in law and in the alter4nate and without prejudice, deduction u/s 80P(2)(a)(i) and section 80P(2)(a)(iv) of the Act ought o be granted to the appellant. 30. We find that alternative ground appeal raised by assessee is identical to the additional ground of appeal raised in ITA No.2386/Ahd/2016 for assessment year 2009-10, which we have restored to the file of Ld. CIT(A). Therefore the additional grounds of appeal is restored to the file of Ld. CIT(A) with similar direction. In the result the additional ground of appeal is allowed for statistical purpose. The ld. AR of the assessee has not argued anything on the ground No.1 of appeal raised primarily. Thus, the original ground No.1 of appeal is ..... X X X X Extracts X X X X X X X X Extracts X X X X
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