9911796707
TMI Blog2023 (4) TMI 950X X X X Extracts X X X X X X X X Extracts X X X X ..... e wider scrutiny in those cases can only be conducted as per the guidelines and procedures stated in Instruction number 7/2014. According to us when the learned assessing officer was not required to enquire on those issues such as purchases in cash more than specified sum, the learned CIT was not correct in holding that the learned assessing officer has not made due inquiries on that ground as the verification of the purchases exceeding specified limit in cash was not an issue before the assessing officer. Naturally, he should not have made any enquiry on that aspect. Even though the learned assessing officer has raised the specific questions on that aspect and verified the requisite detail. The order passed by the Tribunal has been pass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nge. The total income was assessed at Rs. 421310/-, vide order dated 30/12/2013. On 27/7/2015, a show cause notice under section 263 of the income tax act was issued to the assessee by the principal Commissioner of Income tax stating that while perusing the assessment records, it was noticed that assessee has made purchases in cash totaling Rs. 1,31,24,334/- in contravention of the provisions of section 40A(3) of the income tax Act 1961. Hence, the expenditure exceeding Rs. 20,000 incurred in cash in contravention of the above section is not allowable as deduction. It was further noted in the show cause notice that on perusal of the copy of account of the bank filed by assessee during the course of assessment proceedings, it revealed tha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... essee, the Tribunal has observed as under:- The Tribunal has rightly observed that there was an audit objection by the Internal audit party which is placed at page number 30 of the paper book. As per the para number two of that audit note it is mentioned that that the case of the assessee was selected for scrutiny under the CASS with a specific direction that the AO should examine the source of cash deposits in his savings bank account as per AIR information. The audit party further notes that from the perusal of the printouts of the screenshots of the AIR Information placed on records, it is transpired that during the year the total case deposits have been made by the assessee in his bank account maintained with Jammu and Kashmir bank ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... and deposited in the bank account on the same day or alternate days. Assessee also produced vide same letter the cashbook for the relevant period. Assessee also placed the copy of the bank account with Jammu and Kashmir bank at page number 21 of the paper book, which was submitted along with that letter. Therefore assessee gave complete explanation about the cash deposit in the bank account with the Jammu and Kashmir bank and also demonstrated the cash realized on sale of goods. Undisputedly the sale of goods have also been shown. on the credit side of the profit and loss account, the cash has been generated out of the sale and same has been deposited in the bank account. The above fact has been verified by the learned assessing offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the purchase made by the assessee in cash, whether the learned assessing officer is required to make any such enquiry or not is also an issue. This because of the reason that the learned assessing officer was only required to verify the cash deposit in the bank account of the assessee. In this respect instruction dated 29/12/2015 issued by the central board of direct taxes is very relevant. Apparently the selection of the scrutiny in case of the assessee was also only on the parameters of AIR information. According to para number 2 (il) the scope of enquiry should be limited only on that aspect only. In such cases, the assessing officer are also directed to confine themselves by questionnaire only to the specific issues pertaining to AIR da ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
