2022 (11) TMI 1167

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....o as the 'Act'). The Revenue in this appeal has taken the following grounds of appeal: "1. That on the facts and in the circumstances of the case, the Ld. CIT(A) failed to take cognizance of the Remand Report submitted by the A.O. where it has been clearly recorded that out of the total 31 parties of cash purchase the assessee failed to provide the address of 13 parties and could produce ledger Copy of only 21 parties but no supporting documents by way of bills/vouchers over 14 hearings and without appreciating these facts on record, the ld. CIT(A) deleted the addition of cash purchases by accepting fresh evidence in contravention to Rule 46A of the 1.T. Rules, 1962. 2. That on the facts and in the circumstances of the cas....

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.... cash and the difference of Rs.25,20,946/- was claimed to be the commission out of the above transaction. The Assessing Officer held that the assessee had violated the provision of section 40A(3) of the Act by making the aforesaid cash purchases amounting to Rs.7,20,27,038/-. Therefore, the Assessing Officer invoking the provisions to section 40A(3) of the Act, added back the said amount to the total income of the assessee. 3. Being aggrieved from the above order of the Assessing Officer, the assessee preferred appeal before the CIT(A). Before the ld. CIT(A), the assessee explained its business architecture by explaining that the assessee is a 'single sim multi-recharge platform provider' which means that the assessee provides a platform....

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....y directly. It was explained that in the relevant financial year, the assessee has made bulk purchases of talk-time of Rs.79,07,60,072/-, wherein, all payments were paid by cheque and by bank transfer mode. However, only remaining amount of Rs.7,20,27,038/- which was the value of talk-time that has been purchased in cash from various other small distributors and retailers and as and when the need for such talk-time stock arose. That the aforesaid cash purchases have been made in enumerable number of transactions on different dates and where not a single payment has exceeded the threshold limit of Rs.20,000/-. The cash book, purchase register and all individual invoices have been produced before the CIT(A). The ld. CIT(A), after considering ....

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....five different Companies is actually engaging Rs.10,000/- of his capital per day and getting return thereby on it as recharge commission in form of talk time value. Now by subscribing to a single SIM multi recharge platform which is provided by the assessee, he does not have to deploy more funds for pore wallets but far less fund in a single wallet with the assessee company.3ince, less amount of fund is now kept deployed and the business of recharge of mobile and D2H services become less hassle free for the individual retailers, they have no hesitation in settling for a lower value of commission amount in the form of talk time stock which they now get from the assessee company. This in fact means that the assessee buys back not only the LAP....