Sanjay Kumar Jaysawal Vs. Income Tax Officer

Parties Involved

Facts Summary

The assessee, Sanjay Kumar Jaysawal, is engaged in the business of purchase and sale of mobile handsets under the name and style M/s S.S. Agency. The original assessment for the year 2011-12 was completed on 28-02-2014, determining the total income at Rs.2,85,250/-. An audit report revealed that the assessee made cash payments aggregating to Rs.32,06,400/- for the purchase of mobile handsets in excess of Rs.20,000/- in violation of section 40A(3) of the Act. Based on this information, the Assessing Officer (AO) reopened the assessment and made an addition of Rs.32,06,400/-. The assessee challenged this addition before the Commissioner of Income Tax (Appeals), who confirmed the addition. The assessee then appealed to the Income Tax Appellate Tribunal.…

Legal Issues

• 1. Whether the addition made by the AO under section 40A(3) of the Act is justified?

Judgment Outcome

Decided in favour of Assessee.

Precedents Relied Upon

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