Law: Income Tax Act, 1961

Section: 260A,40A(2)(A)

ORDER 1. The Court: This appeal under Section 260A of the Income Tax Act, 1961 is from an order dated 18th September, 2003 passed by the learned Income Tax Appellate Tribunal "A" Bench, Kolkata in ITA No.1475 (Kol.)/2001 for the assessment year 1994-95 on the following questions: "(i) Whether the burden to prove that any expenditure respect of which payment is made to a person referred to in Section 40A(2) (b) is excessive or unreasonable within the meaning of Section 40A(2) (A) is on the assessing officer can and the Tribunal was justified in law in casting the burden upon the appellant to show that the conversion charge paid by it was equal to the market rate or was not excessive or unreasonable? (ii) Whether the initial explanation offered by the assessee assuming that the burden lay on the assessee amounts to discharge of the burden and shifting of the onus on the assessing officer and in the facts and circumstances of the case could the assessing officer disagree with the offer without adequate materials to deny the explanation and alternatively could the onus shift on the assessee and would the assessee be entitled to an opportunity to explain the point of disagreement noted by the assessing officer? (iii) Whether the tribunal was justified in law in disallowing Rs.766.76 per M.T. in respect of pig from and C.I. Scrap out of the conversion charge of Rs. 2.766. 76 per M.T. under Section 40A(w2) as excessive and unreasonable and its purported findings in that behalf are arbitrary, unreasonable and perverse?" 2. Mr. Mukherjee, learned Advocate appearing for the appellant, submits that the order passed by the Tribunal is perverse as there is no basis for accepting conversion charges at Rs.2000/- per M.T. Prayer is made to remand the matter before the Assessing Officer for fresh assessment. 3. Mr. Dudhuria, learned Advocate appearing for the Revenue, submits that in view of the letter dated 21st November, 1998 issued by Marcandy Prasad Radha Krishna Prasad Private Ltd., the sister concern of the appellant, justifying the imposition of higher rate for conversion charges and as the entire issue has been dealt with by the Tribunal specifically, the order under…

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