2022 (8) TMI 850

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....3-2013 declaring total income of Rs.34,58,070/-. The assessment was completed u/s.143(3) on 21-03-2014 wherein the total income was assessed at Rs.39,65,910/-. Thereafter, the AO found that the assessee had paid purchase consideration in contravention of section 40A(3) of the Act. The case was re-opened by means of a notice u/s.148. The assessment was completed u/s.143(3) r.w.s. 147 on 29-12-2016 determining total income of Rs.50,65,910/-. The ld. Pr. CIT observed that in the assessment made u/s.143(3) r.w.s. 147, the Assessing Officer (AO) did not disallow Rs.1,06,72,500/- u/s.40A(3) of the Act but settled the disallowance only at Rs.11.00 lakh. That is how, he opined that remaining cash payments also ought to have been disallowed. He, the....

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....00000 1500000 0 1500000 12 Chandrakant G. More 175000 175000 175000 0 13 Shivaji Salunke, Khandgaon 0 400000 0 400000   Total Rs. 11842500 9672500 1100000 8572500 Total wrongly mentioned in Notice u/s.163 10672500       4. While finalizing the assessment u/s.143(3) rw.s.147, the AO disallowed the transactions at Sl. Nos. 5,6,7, 8 and 12 totalling to Rs.11.00 lakh only. The assessee stated before the ld. Pr.CIT that the remaining persons, to whom the cash payments were made, were residing in two villages, namely, (1) Pakahrsangvi and (2) Khandgaon, which were not served by any bank. In support of this contention, the assessee produced certifi....

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....AO during the course of assessment proceedings on the basis of which he got satisfied and did not make any disallowance, these were also filed before the ld. Pr.CIT in the revision proceedings. He did not find anything amiss in them and still preferred to direct the AO to verify their veracity. Under such circumstances, we fail to comprehend as to how the assessment order can be termed as erroneous and prejudicial to the interest of revenue. The position would have been different if the AO had accepted the contention of the assessee of being covered under rule 6DD(g) without any support of the certificates. Here is a case in which the assessee furnished necessary certificates from Gram Panchayat (Local Govt. authority) indicating that the r....