Jalitha Jagadeesan vs. The Asst. Commissioner of Income Tax

Parties Involved

Facts Summary

The assessee, Jalitha Jagadeesan, is a dealer in retail sales of IMFL Liquor in Pondicherry. She filed her income return on 04.01.2022, admitting a total income of Rs.14,13,910/-. The CPC, Bengaluru made an adjustment in the intimation issued under Section 143(1) of the Income-tax Act, 1961, disallowing cash payments totaling Rs. 89,27,690/- under Section 40A(3) of the Act. The assessee appealed to the Commissioner of Income Tax (Appeals), who confirmed the disallowance. The assessee further appealed to the Income Tax Appellate Tribunal.…

Legal Issues

• 1. Whether the order of the National Faceless Appeal Centre (NFAC) is wrong, illegal and opposed to facts.
• 2. Whether the NFAC erred in upholding the disallowance made by the CPC by invoking Section 40A(3) of the Act.
• 3. Whether the NFAC ought to have seen that the disallowance under Section 40A(3) is unjust as it should follow after giving an opportunity as per the proviso.
• 4. Whether the NFAC without appreciating the facts/evidence of the case, confirmed the disallowance made under Section 40A(3) of the Act.
• 5. Whether the NFAC having not disputed the payment in cash by the appellant to the dealer of IMFL product as genuine, ought to have seen that it was not open to the appellate authority to make addition of the same to the returned total income under Section 40A(3) of the Act.
• 6. Whether the NFAC ought to have seen that the appellant is a retailer of IMFL products in Pondicherry and that the Government of Pondicherry imposed a special excise duty of 25% on the IMFL products, and the appellant paid the special excise duty in cash to the dealer due to business exigency.

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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