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TMI Blog2023 (5) TMI 782X X X X Extracts X X X X X X X X Extracts X X X X ..... Act with specific intention to discourage colourable payments then the Ld. Tax Authorities below cannot be expected to accept such casual explanations. There should be a justification in the refusal of a party to not accept payment by way of a crossed cheque/draft to defeat a provision made under Act to discourage cash payments. There is nothing on record to show that the nature of purchases was such that the parties were having decisive role to lay the terms and conditions of mode of payment to be with cash or bearer cheques only and that the assessee's business interest would have suffered due to non-availability of goods otherwise than from this particular party. The law relied, including the Boards s circular, is thus not applicable on facts and evidence. Decided against assessee. - ITA No. 139/Del/2018 - - - Dated:- 26-4-2023 - SH. SHAMIM YAHYA , ACCOUNTANT MEMBER AND SH. ANUBHAV SHARMA , JUDICIAL MEMBER For the Appellant : Sh. Sanjay Issar , CA For the Respondent : Sh. B. K. Singh , Sr. DR ORDER PER ANUBHAV SHARMA , JM : The appeal has been preferred by the Assessee against the order dated 29.09.2017 of CIT(A)-12, New Delhi (hereinaft ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... xceptional or unavoidable circumstances; or b. because payment-in the manner aforesaid was not practicable, or would-have caused genuine difficulty to the payee, having, regard to the nature of the transaction and the necessity for expeditious settlement thereof, and also furnishes evidence to the satisfaction of the Income-tax Officer as to the genuineness of the payment and the identity of the payee. 6.3.5 It is claimed that circumstances of the Assessee were exceptional as the parties were not accepting payments through account payee cheques. There are conditions when payment through RTGS are not practical. Before me, the Assessee has submitted certificates from M/s Dolphine Sales Corporation (Prop. Satish Sharma), Varun Verma (Prop. M/s Balaji Trading Co.) and Vikas Pathak for M/s Salasar Enterprises. It is claimed that these certificates were submitted before the Assessing Officer. But it is seen that the Assessing Officer has not mentioned the submission of certificates in the assessment order. Secondly, the certificates are not the copy of any original certificate but actually original certificates on the letter heads of the parties without putting the date. The ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e circumstances, I hold that the Assessing Officer was justified in disallowing the payments u/s 40A(3) of the l.T. Act. Accordingly, the grounds are dismissed. 3. The Assessee is in appeal raising following grounds :- 1. On the facts and in the circumstances of the case and in law the Hon ble Commissioner of Income-tax (Appeals) erred in rejecting that CBDT circular 220 (F No. 206/17/76-IT (A-II) dated 31/05/1977 and ignored that the creditors have duly confirmed the receipt of these bearer cheques. 2. On the facts and in the circumstances of the case and in law the Hon ble Commissioner of Income-tax (Appeals) erred in rejecting the addition of Rs. 27,713,513/- on account of bearer cheques issued to creditors with their consent for non - acceptance of account payee cheque as not an abnormal situation. The assessee had no option if he wanted to survive in the market. 3. On the facts and in the circumstances of the case and in law the Hon ble Commissioner of Income-tax (Appeals) erred in rejecting that issuing payment through RTGS or NEFT is not possible under peculiar circumstances and various case laws mentioned by the assessee. 4. On the facts and in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s also relied by Ld. AR, that even after amendment of Rule 6DD(j), the legal exposition propounded by the Hon ble Supreme Court in case of Attar Singh Gurmukh Singh Vs. ITO, 191 ITR 667 (SC), regarding consideration of expediency and other relevant factors cannot be considered to be diluted as the rules framed by way of delegated legislation cannot override the substantive legislation in form of section 40A(3) which has not changed its character. 6.2 The Boards Circular no 220 has been considered in various judicial pronouncements and a view is expressed by the Hon ble High Court of Calcutta in Girdharilal Goenka v. CIT [1989] 179 ITR 122, where it was observed that (at p. 128): The circular of the Board is not exhaustive, it is only illustrative and the Assessing Officer has to take into account the surrounding circumstances, considerations of business expediency and the facts of each particular case in exercising his discretion either in favour or against the assessee'. It was also held that the Income-tax Officer should take a practical approach to the problem and strike a balance between the direction of law and hardship to the assessee. 7. The bench has given ..... X X X X Extracts X X X X X X X X Extracts X X X X
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