Case Law Details
Case Name : Commissioner of Income Tax Vs M/s. Venkatadhri Constructions (Madras High Court)
Appeal Number : TC (A) Nos. 122 Of 2003
Date of Judgement/Order : 29/06/2012
Related Assessment Year :
Courts :
All High Courts Madras High Court
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HIGH COURT OF MADRAS
Commissioner of Income-tax, Madurai
Versus
Venkatadhri Constructions
TC (A) NOS. 122 OF 2003
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The law should be amended to exclude such payments from the clutches of section 140A(3) in order to facilitate the business community to cope up with the modern developments in Banking industry. While the identity of the receiver is proved and that too with the payment is made through proper channel why it should be questioned? The courts should go beyond the letter of the law and should to look into the purpose of legislation.
This judgment goes against the core of today’s banking operations which facilitate instant trnasfer of funds from one account to another and from one place to another; with very little cost, and after sufficient documentation as to payer’s identity etc. The main purpose of 140A(3) is to prevent payments in cash, in specie from a person to another. Where the money is directly deposited into the payee’s bank account the object is achieved in intent and spirit. It is : All transations should be routed through banking channels. Where a trader takes out cash from his cash sales and deposits payee’s account for instant transfer , there is an element of enormous saving in transaction time: It will be an improvement over a series of transactions starting from crediting own bank a/c and then issuing cheque/pay order/draft involving postal delay and bank delay in clearing at the point of payment, which could be more than week. The judgment seems to have been rendered in a huff and weighed down by unjustified clinical analysis of the text provisions; which are outdated to the present day banking operations which ought to have been highlighted , and if canvassed should have been favoured.
The Govt of India does not intend to fill its coffers by incremental addditions to the NORMAL TAXES , of amounts which are not strictly legitimate taxes. It is high time that there is enlightened thinking in administrative and judiciary machinery to save the ordinary man from complying with hellish and draconian tax requirements that even experts fail to comprehend. It shd be ensured that taxation obligations do not run beyond two years and shd automaticallly lapse. Let the administration function effectively to zero error level, and not blame the citizenry and try to make up lost time by prolonging matters indefinitely. .