Cash payment disallowance under the statutory limit upheld where Rule 6DD exception was not proved by evidence.

Delay in filing the appeals was condoned on reasonable cause, as the assessee showed lack of tax knowledge, reliance on professional advice, and ill health supported by medical material. Additional grounds challenging reassessment were not admitted because no convincing factual foundation was shown to support non-compliance with the mandatory reassessment requirements. Disallowance of cash purchases was upheld under the cash payment rule because the assessee failed to produce ledger accounts, confirmations, or other evidence to bring the payments within Rule 6DD, and the statutory limit was exceeded.

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Issues: (i) Whether the delay of 100 days in filing the appeals deserved condonation; (ii) whether the additional grounds challenging the reassessment were admissible; (iii) whether the disallowance made under section 40A(3) for cash purchases was justified.

Issue (i): Whether the delay of 100 days in filing the appeals deserved condonation.

Analysis: The delay was explained on the basis of lack of tax knowledge, reliance on professional assistance, and the assessee's ill health supported by medical material. The explanation was accepted as constituting reasonable cause for the belated filing.

Conclusion: The delay was condoned and the appeals were admitted.

Issue (ii): Whether the additional grounds challenging the reassessment were admissible.

Analysis: The proposed grounds were held not to be supported by any convincing factual basis showing non-compliance with the mandatory requirements for reassessment. As no sufficient foundation was shown for entertaining them, they were not admitted.

Conclusion: The additional grounds were rejected and dismissed.

Issue (iii): Whether the disallowance made under section 40A(3) for cash purchases was justified.

Analysis: The assessee failed to produce supporting ledger accounts, confirmations, or material bringing the case within Rule 6DD. The cash payments were found to exceed the prescribed limit, and the exception under Rule 6DD was not established. The factual matrix supported the lower authorities' conclusion that the payments were hit by section 40A(3).

Conclusion: The disallowance was upheld and the assessee's challenge failed.

Final Conclusion: The Tribunal sustained the assessment on the merits and declined to interfere with the disallowance, resulting in dismissal of all the appeals.

Ratio Decidendi: Cash payments exceeding the statutory limit are disallowable unless the assessee establishes a specific exception under Rule 6DD on the basis of supporting evidence.

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