Case Law Details
Govind Ramprashad Baheti Vs ITO (ITAT Pune)
The assessee admittedly runs Baba Ramdev Krishi Seva Kendra involving primarily rural customers engaged in agricultural activities. And that he carries out his business activities regarding sale of various agricultural products only. There is further no dispute that the recipient herein is also engaged in very line of business activities only.
Coming to assessee’s former claim of Rs.50,000/, we note from a perusal of his paper book that he had deposited cash of Rs.50,000/- in bank; which in turn, was credited to the account of M/s. Subhash Fertilizer Pvt. Ltd.. The same could hardly be termed as violation of section 40A(3) per se. The factual position could hardly be different qua the latter payee Shriram Fertilizers, Nanded as well as these parties are carrying out the respective business activities involving farming sector only wherein not all the customers have their bank accounts since residing in remote areas. Hon’ble Gujarat high court in Anupam Tele Services vs. ITO [2014] 366 ITR 122 (Guj.) holds that the overwhelming genuine business transactions are nowhere sought to be covered u/s 40A(3) of the Act. Faced with this situation and keeping in mind peculiar business activity of the assessee as well as his twin payees, we hold that he has sufficiently proved by way of reasonable explanation regarding overwhelming circumstances leading him to make cash payment in issue. We accordingly direct the Assessing Officer to delete the impugned disallowance.
FULL TEXT OF THE ORDER OF ITAT PUNE
This assessee’s appeal for assessment year 2008-09 arises against the CIT(A)-1, Aurangabad’s order dated 27.06.2018 passed in case no. ABD/CIT(A)/335/2013-14, involving proceedings u/s 143(3) r.w.s. 263 of the Income Tax Act, 1961; in short “the Act”.
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