TaxTMI 
TaxTMI 
2014 (3) TMI 325
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....he aforesaid addition of Rs.2,03,750/- u/s 41(1)(a) of the Act on the ground that the said payment is pending for three years and nothing moved on this account. Since Perfect Engineering Works has refused to work again on the body of trailer and the assessee is not willing to pay unless the work is done to his satisfaction, the AO stated that the liability of the assessee has ceased. The ld. CIT(A) deleted the said addition after considering the fact that the assessee filed a copy of ledger account of M/s Perfect Engineering Works for the period from 1.4.2006 to 7.7.2010 and it is seen that the amount had not been written off by the assessee in its books of account. Therefore, the liability is not ceased. Moreover, the assessee also filed a....
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....his family members as under : Name Relation amount Rajkumari Makad Wife of the assessee Rs.1,00,000/- Sunil Makad Son of the assessee Rs.1,00,000/- Sunil Makad (HUF) Son of the assessee Rs.1,00,000/- Bharti Makad Daughter-in-law Rs.1,35,000/- Gopal Makad Grand son Rs.1,00,000/- Hema Makad (minor) Grand daughter Rs.1,00,000/- Naresh Makkad Son of the assessee Rs.1,00,000/- Sudha Makkad Daughter in law Rs.1,00,000/- AO stated that the assessee could not substantiate the basis for paying commission to his wife, two daughters- in- law , his grandson and his granddaughter. He has stated that the assessee has no evidence for work executed by family members for his business. Nor the assessee could furnish any evi....
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....b) of the Act being excessive . Hence, this appeal by the department 8. At time of hearing, ld. DR submitted that no evidence was produced by assessee for services rendered and ld. CIT(A) has accepted the contention of the assessee without any evidence. He further submitted that no basis has been given by the ld. CIT(A) to restrict the disallowance to 20% of Rs.6,35,000/- by considering it excessive under the provision of section 40A(2)(b) of the Act. 9. On the other hand, ld. AR relied on the order or ld. CIT(A). He further submitted that the said payees are assessed to tax and the department should have taken a pragmatic view for the payment of the said commission by the assessee to his family members. He submitted that the order of the....
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....ce any evidence to verify that the total expenditure to daily wages and contract of Rs.61,62,042/- is genuine business expenditures of the assessee. AO has stated that the payments as per vouchers ranging from Rs.1000 to Rs.15000/- and each of the worker is individually paid, amounts as big as Rs.15,000/- in a day. The said vouchers do not establish the actual nature of work executed. Considering the facts and the fact that the said vouchers are self made vouchers, he disallowed 5% of the total claim of the assessee which come to Rs.3,08,102/-. Being aggrieved, the assessee filed Appeal Before the First Appellate Authority. 13. Ld. CIT(A) after accepting the contention of the assessee has stated that the said payment of Rs.10,000/- or so, ....
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.... to verification, that the said payment were made in cash against self made vouchers. Hence, we allow ground No.3 of the appeal taken by department reversing the order of ld. CIT(A). 16. In ground No.4 of the appeal, the department has dispute the order of ld. CIT(A) in deleting the disallowance of Rs.61,115/- made by AO out of telephone expenses on account of personal use. 17. The assessee has claimed the expenditure of Rs.6,11,151/- under the head telephone expenses. The AO has stated that personal use of telephone could not be ruled out and accordingly disallowed 10% of the claim of the assessee which comes to Rs.61,115/- The assessee filed appeal before the First Appellate Authority. 18. The ld. CIT(A) after considering the submissio....