2014 (4) TMI 66

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....harges to the extent of Rs.2,88,34,000/- even after recording the finding that the labour register was incomplete and had certain inherent defects." 3. The learned DR submitted that the labour register produced by the assessee was not complete, and there were number of defects therein, and therefore, the AO was justified in making the disallowance out of the labour expenses claimed by the assessee. He submitted that the assessee failed to produce the addresses of the payees of the labour charges and could not substantiate the labour charge payments and the cash payments out of the labour charges to the extent of Rs.2.94 crores was disallowed by the AO. He submitted that the CIT(A) has wrongly restricted the disallowance out of the labour....

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....gainst 54.13% in the immediately preceding assessment year 2006-07. The assessee has claimed that the return of income of the assessee in the earlier assessment year 2006-07 was accepted in scrutiny assessment and only 1/5th out of some expenses amounting to Rs.1,97,874/- were disallowed by the AO. The assessee is a sub-contractor. However, we find that the assessee was not cooperative in the matter of its assessment before the AO and the ex parte assessment was framed by the AO under section 144 of the Act. The assessee did file certain details of expenses claimed, but could not file the complete address of the persons to whom the payments of labour charges were made. In reply to a specific query from the Bench, the assessee produced "loos....

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....nd in the circumstances of the case and in law, the ld.CIT(A) has erred in deleting the addition made on account of disallowance of service tax payment of Rs.68,18,444/- found to be not recorded in the books of account considering that the assessee has not furnished details of service tax payable and service tax paid." 6. The learned DR has relied on the order of the AO and the learned counsel for the assessee has relied on the order of the CIT(A). We have considered rival submissions. We find that the CIT(A) has observed that the AO has passed the order without verifying the records on the file. The audit report mentions the amount of provision of service tax payable which required no further evidence. The CIT(A) was of the opinion that....