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TAXAP/127/2009 4/ 4 ORDER
IN
THE HIGH COURT OF GUJARAT AT AHMEDABAD
TAX
APPEAL No. 127 of 2009
=========================================
COMMISSIONER
OF INCOME TAX, GANDHINAGAR - Appellant(s)
Versus
PERFECT
CONSTRUCTION CO - Opponent(s)
=========================================
Appearance :
MR
MANISH R. BHATT, SR. ADVOCATE with MRS MAUNA M BHATT
for Appellant
None for
Opponent(s) : 1,
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CORAM
:
HONOURABLE
MR.JUSTICE D.A.MEHTA
and
HONOURABLE
MS.JUSTICE H.N.DEVANI
Date
: 02/03/2010
ORAL
ORDER
(Per
: HONOURABLE MR.JUSTICE D.A.MEHTA)
The
appellant revenue has proposed following question in appeal
filed under Section 260A of the Income Tax Act, 1961 (the Act),
stated to arise out of the order dated 11.7.2008 made by the Income
Tax Appellate Tribunal, Ahmedabad.
Whether,
on the facts and circumstances of the case, the Appellate Tribunal
was justified in confirming the decision of the CIT (A) in deleting
the addition made on account of labour payment even though the
assessee had not discharged its onus to prove the genuineness of the
labour payment?
The
Assessment Year in question is 2000-2001, relevant accounting period
being financial year 1999-2000. In assessment framed under Section
143(3) of the Act, a sum of Rs.13,43,860/- was disallowed by the
assessing officer. The assessee carried the matter in appeal and
succeeded before Commissioner (Appeals). The Tribunal has dismissed
the departmental appeal.
Learned
Senior Counsel appearing for the appellant revenue submitted
that the Tribunal has failed to appreciate that the claim of
expenses towards the labour was not supported by any evidence and
the onus was not discharged by the assessee. The assessing officer
was, therefore, justified in partly disallowing the labour expenses.
It was further submitted that the Tribunal has proceeded on
hypothesis without any evidence.
As
can be seen from the impugned order of the Tribunal, in paragraph
No.5, the Tribunal has summarized the findings recorded by the
assessing officer. As against that, in the latter part of the same
paragraph, the Tribunal has taken note of the total work receipts
and labour expenses incurred by the assessee for the financial year
under consideration and immediately preceding financial year. The
Tribunal has noted that if considered in isolation, it appears that
the labour expenses have increased, but when considered in context
of the total receipts of the assessee, the labour expenses had
decreased from 11.81% in financial year 1998-1999 to 10.78% in the
current year. The Tribunal has, thus, found as a matter of fact
that in context of the total receipts, the percentage of labour
expenses has decreased in the current year. Furthermore, the
Tribunal has taken note of the fact that all the sub-contractors who
undertook to supply labour have filed income-tax returns and details
of the acknowledgments are available for earlier year. The Tribunal
has, thus, found that the labour contractors were genuine parties
who had filed returns of income. The Tribunal has also found as a
matter of fact that the site of construction is far away and the
sub-contractors could not be produced before the assessing officer
on a particular day. Insofar as certain bills remaining outstanding
at the end of the year, the Tribunal has found as a matter of fact
that the majority of bills were raised in the last month of the
financial year and hence, remained outstanding. Thus, on an overall
appreciation of the facts and evidence on record, both the
Commissioner (Appeals) and the Tribunal have concurrently found that
there was no basis for disallowing 15% of the labour expenses.
In
light of the aforesaid concurrent findings based on appreciation of
facts and evidence on record, it is not possible to find any legal
infirmity in the impugned order made by the Tribunal. No question
of law, much less a substantial question of law can be stated to
arise out of the impugned order of Tribunal.
The
appeal is, accordingly, dismissed.
[D.A.MEHTA,
J.]
[HARSHA
DEVANI, J.]
parmar*
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