TaxTMI 
TaxTMI 
2023 (1) TMI 367
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....red in law as well as on facts in upholding disallowance of payment made of Rs. 7,54,7000/- u/s 40A(3) of the Income Tax Act, 1961. The appellant prays that the same may kindly be heard and allowed. 3) That the order passed by the Ld. CIT u/s.250 of the I.T. Act, 1961 was arbitrary, bad in law and unjust. 4) That the assessee craves leave to urge such other ground or grounds before or at the time of hearing of appeal." 3. The first issue raised by the assessee is that the learned CIT(A) erred in holding that delay in filling the appeal cannot be condoned. 4. At the outset, we note that there was the delay in filing the appeal by the assessee for 556 days before the learned CIT (A) which was not condoned by him. However, we find that the learned CIT (A) has also decided the issue raised by the assessee on merit. It is the trite law that if the appeal is not maintainable in view of the fact that there was the delay in filing the appeal as the assessee couldn't justify the reason for the same. Thus the appeal filed by the assessee should have been dismissed in limine without going into the merit of the case. But what is arising from the order of the learned CIT (A) that the l....
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....citizens have a lawful right and the lawful right is being denied to them merely on technical grounds. The State authorities cannot adopt the attitude which private litigants might adopt." 4.2 From the above it is revealed that the income of the assessee should not be over assessed even there is a mistake of the assessee. As such the legitimate deduction for which the assessee is entitled should be allowed while determining the taxable income. 4.3 We also note that the Hon'ble Gujarat High Court in the case of Vareli textile industry versus CIT reported in 154 Taxman 33 wherein it was held as under: It is equally well-settled that where a cause is consciously abandoned (as in the present case) the party seeking condonation has to show by cogent evidence sufficient cause in support of its claim of condonation. The onus is greater. One of the propositions of settled legal position is to ensure that a meritorious case is not thrown out on the ground of limitation. Therefore, it is necessary to examine, at least prima facie, whether the assessee has or has not a case on merits. 4.4 In view of the above and after considering the facts in totality, we are of the view that it is a fi....
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....Employee after deducting TDS where, employee is temporarily posted for a continuous period of fifteen days or more in a place other than his normal place of duty or on a ship & that employee does not have any bank accounts at that place. 2. Where any payment is made to an employee or the heir of any such employee, on or in connection with the retirement, retrenchment, resignation, discharge or death of such employee, on account of gratuity, retrenchment compensation or similar terminal benefit and the aggregate of such sums payable to the employee or his heir does not exceed Rs 50,000. Since the appellant does not fall in any category of exceptions as such the reply has no force. 7. The addition is upheld, appeal stands dismissed, delay is not condoned." 11. Being aggrieved by the order of the learned CIT(A), the assessee is in appeal before us. 12. The learned AR before us filed paper book running from page 1 to 47, compilation case laws and contended that the case of the assessee was selected under limited scrutiny and therefore the scope of the scrutiny was Ltd to the extent of verification of cash balance until and unless some approval is obtained from the higher au....
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....onetary limit shall be Rs. ten lakhs) requiring substantial verification on any other issue(s), then, the case may be taken up for 'Complete Scrutiny' with the approval of the Pr. CIT/CIT concerned. However, such an approval shall be accorded by the Pr. CIT/CIT in writing after being satisfied about merits of the issue(s) necessitating 'Complete Scrutiny' in that particular case. Such cases shall be monitored by the Range Head concerned. The procedure indicated at points (a), (b) and (c) above shall no longer remain binding in such cases. (For the present purpose, 'Metro charges' would mean Delhi, Mumbai, Chennai, Kolkata, Bengaluru, Hyderabad and Ahmedabad)." 15. The CBDT further amended the para 3(d) of the above mentioned instruction via instruction no. 05/2016 dated 14-07-2016 with additional requirement that the AO will form a reasonable view with regard to the potential escapement of income. The relevant portion of the instruction stands as under: "2. In order to ensure that maximum objectivity is maintained in converting a case falling under 'Limited Scrutiny' into a 'Complete Scrutiny' case, the matter has been further examined an....
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....thority. Accordingly, we hold that the Assessing Officer has exceeded his jurisdiction by making disallowances of cash payment as per the provision of section 40A(3) of the Act. 17. The right course of action for the AO was to take the approval from the competent authority for expanding the scope of Limited Scrutiny to the regular assessment but he failed to do so. Thus, in our considered view inaction of the AO should not cause any inconvenience to the assessee. In holding so we draw support and guidance from the order of the Hon'ble Chandigarh Tribunal in case of Rajesh Jain vs. ITO reported in 162 taxman 212 where it was held as under: "The jurisdiction of the Assessing Officer in such cases where the notices are issued for limited scrutiny is confined to the claims he has set out in the notice for verification. This position of law was further elaborated by the CBDT in its Circular No. 8/2002, dated 27-8- 2002. The CBDT Circular clarifies that the Assessing Officer does not have the powers to make the entire assessment of income in limited scrutiny cases. Now question had to be decided when the Assessing Officer does not have the powers while making limited scrutiny asses....