NARAYAN BIJOY KUMAR Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) A Statement of the Case has been submitted by the Income-tax Appellate Tribunal, A Bench, Patna, under s. 256(1) of the IT Act, 1961 (hereinafter referred to as the Act) and the following question of law has been referred for the opinion of this Court :

(2.) On appeal the AAC held, rejecting the submissions made on behalf of the assessee, that the payments were made to Patna Trading Company, Darbhanga, which was a genuine business concern and was assessed to income-tax too. The further submission which was rejected was it was in order to maintain the business relation and it was obligatory on the part of the assessee to maintain the tradition of payment in cash to the messenger who used to come to collect cash from the assessee. The legal submission namely that r. 6 DD(j) read with s. 40A(3) was of avail to the assessee was, therefore, rejected. A copy of the appellate order of the AAC has been marked Annexure-B.

(3.) On further appeal to the Tribunal the rival submission made before the AAC on behalf of the assessee as well as the revenue were repeated. The Tribunal, however, found that expecting the production of a certificate showing an understanding between the assessee and the Patna Trading Company the assessee could not produce any satisfactory evidence to show that it was prevented for sufficient cause for non-payment of purchase price to Bank. The Tribunal, therefore, held that the revenue was justified in adding back Rs. 10,000 under s. 40A(3) of the Act. A copy of the order of the Appellate Tribunal is marked as Annexure-C.