Income Tax Act, 1961 /Income Tax Rules, 1962-- Section
40A(3) / Rule 6DD---Validity of--Applicability to payments
made for acquiring stock-in-trade.
HEADNOTE ... bank draft
in the circumstances specified under the rule. Thus section
40A(3) and Rule 6DD are intended to regulate the business
transactions
parties and in
some cases are covered by circumstances notified in Rule 6DD
particularly Rude DD (j) of the I.T Rules, 1962. Therefore ... circumstances specified under the rule. It will be clear from the provisions of section
40A(3) and rule 6DD that they are intended to regulate
covered by the exceptions to Section 40A(3) contained in Rule 6DD of the Income-tax Rules, 1962?
(2) Whether the Tribunal was justified ... provisions of Section 40A(3) of the Act read with Rule 6DD were at all applicable to the purchase of goods, viz., scooters and whether
will not be operative were specified in the Income-tax Rules vide rule 6DD under Notification No. SO-624 dated February 14, 1969.
4. Apart ... areas, omitted rule 6DD(j). However, no other rule is inserted in place of rule 6DD(j) so as to take care of the cases
case has been taken care of by the rule-framing authority by providing in rule 6DD(j) (1) that if payment could not be made ... Taking clue from this statutory provision, the rule-framing authority inserted by a subsequenty amendment in rule 6DD(j) (2) the two other categories
Income-tax Rules, 1962, nor did the circular of the Central Board of Direct Taxes, explaining the provisions of Rule 6DD, cover the assessee ... circumstances specified under the said rule. One of the sub-rules, being sub-rule (j) of rule 6DD, provides as follows
expediency" as mandated only
in Rule 6DD (a) to 6DD(I) of the I.T. Rules, 1962 while the
case or circumstance ... fancies and as suits to the assessee. Therefore
Rules have been prescribed which are Rule 6DD of I.T.Rules, 1962 and
nothing beyond that
exception provided in Clause (f) and Clause (1) of Rule 6DD. He noted that KP is not agent of assessee. He also held that ... circumstances specified under the rule. It will be dear from the provisions of Section 40A(3) and Rule 6DD that they are intended to regulate
Rules, 1962 ?
(5) Whether the payments of huge amounts exceeding Rs. 2,500 made by the assessee were covered by exceptions in rule 6DD ... artificial construction of those rules, the very object of the legislature is not frustrated.
Clause (j) of rule 6DD sets out four circumstances in which
entitled to exemption under Clause (f) or Clause (j) of Rule 6DD in respect of the payment regarding the purchase of the goods from other ... covered by the provisions of Clauses (f) and (j) of Rule 6DD. But all the contentions of the assessee were turned down by the Tribunal
