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TMI Blog2022 (6) TMI 1439X X X X Extracts X X X X X X X X Extracts X X X X ..... posed addition as per show cause notice of assessing officer. The cash payment register wherein payment has been explained to the assessing officer. AO having gone through the cash payment register and explanation of each item, did not make the addition. Therefore, we note that assessing officer has examined this issue during the assessment stage and has taken a possible view and therefore, he did not make the addition. Hence, so far this issue is concerned, the order passed by the assessing officer, is neither erroneous nor prejudicial to the interest of the Revenue. Thus in view of settled legal position with regard to invoking of section 263 of the Act, 1961, we are of the opinion that there is no infirmity in the impugned order passed b ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... acts and in the circumstances of the case and in law, the learned Tribunal had erred in holding that the disallowance u/s 40(a)(ia) was made on the issue of non-deduction of TDS on payment made to Shri Rameshbhai and assessee accepted the disallowance even though no such disallowance was made in the assessment order. (iv) Whether on the facts and in the circumstances of the case and in law, the learned Tribunal was justified in quashing the order passed u/s 263 of the Act without giving a finding on the applicability of clause (a) of Explanation-2 to subsection( 1) of section 263 of the Act on the basis of which the revision order u/s 263 of the Act was passed by the Principal Commissioner of Income-tax." 3. The respondent-assessee is en ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arbhai falls under the category of milk producer and therefore, payment to him in cash in excess of Rs. 20,000/- is permissible under Rule 6DD of the Income Tax Rules. PCIT further observed that other sellers of milk to assessee company were traders and hence not eligible for benefit of this Rule. 7. PCIT further observed that during survey in the financial year 2012-2013, it was found that Rs. 1,82,18,581/- was paid by the assessee in cash in excess of Rs. 20,000/- which was neither disputed nor the statements retracted and only Rs. 20,70,763/- was allowable expenditure under section 40A(3) of the Act, 1961 read with Rule 6DD of the Income Tax Rules, 1962. It was further observed that declaration of Rs. 15,00,000/- paid during the financi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... various person in cash in excess of Rs. 20,000/-, PCIT noticed from the paper book produced by the assessee that the assessee had made the payment in cash in excess of Rs. 20,000/- in a single day which requires detailed verification by the Assessing Officer. Therefore, the PCIT set aside the order passed by the Assessing Officer with a direction to frame a fresh assessment. 11. Being aggrieved by the order passed by the PCIT under section 263 of the Act, 1961, the assessee preferred appeal before the Tribunal. The Tribunal by impugned order allowed the appeal quashing and setting aside the order passed by PCIT as under : "In ITA No. 310/SRT/2018 {for assessment year 2013-14, ld PCIT has raised the same issue of payment in cash in excess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nterest of revenue. We note that during the assessment proceedings, assessee had submitted before assessing officer (AO), the cash payment register and explained each of the item of proposed addition as per show cause notice of assessing officer. The cash payment register, which is placed at paper book page nos, 22 to 27, wherein payment to the tune of Rs. 1,82,18,581/- has been explained to the assessing officer. The assessing officer, having gone through the cash payment register and explanation of each item, did not make the addition. Therefore, we note that assessing officer has examined this issue during the assessment stage and has taken a possible view and therefore, he did not make the addition. Hence, so far this issue is concern ..... X X X X Extracts X X X X X X X X Extracts X X X X
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