TaxTMI 
TaxTMI 
2015 (8) TMI 1088
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....mandeep Kumar and Rs. 1,59,000 to his son Shri Daniel. The Assessing Officer noted that during the year maximum salary paid to the other employees is Rs. 84,000 per annum. The Assessing Officer further noted that Shri Amandeep Kumar was only 10th pass and not technically qualified. The Assessing Officer accordingly held that salary paid to Shri Amandeep Kumar was excessive. The Assessing Officer disallowed Rs. 1,53,000 out of salary paid to Shri Amandeep Kumar under section40A(2)(a) of the Act. 6. The assessee challenged the addition before the learned Commissioner of Income-tax (Appeals) and written submission is quoted in the impugned order, in which the assessee briefly explained that the assessee is approximately 57 years of age and is engaged in the business/profession of providing services of crane on job work basis for construction of bridges, heavy load machinery and in uplifting of machinery in furnaces meaning thereby the business/profession of providing the services with the aid of cranes which can basically be done by the young and energetic persons. The cranes could not be operated by every labourer and need experience to operate the same. Any mishappening of the cran....
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....so not in dispute that the salary/wages paid was comparably lower in percentage as was paid in the earlier years. These facts would clearly support the case of the assessee that both the sons of the assessee have been working whole heartedly for the business of the assessee and through their efforts total receipts of the assessee have increased. Therefore, the Assessing Officer has failed to make out a case of any unreasonable payment to the sons of the assessee. However, considering the fact that Shri Amandeep Kumar was not qualified as against the qualification of other son Shri Daniel, it would be reasonable and appropriate to restrict the salary paid to Shri Amandeep Kumar slightly lesser as was given to Shri Daniel because both of them were doing the same job for the assessee. Considering the above discussion, it would be reasonable and appropriate to allow salary paid to Shri Amandeep Kumar in a sum of Rs. 1,50,000 as against the payment of salary of Rs. 2,25,000, thereby the addition is restricted to Rs. 75,000 only. The orders of the authorities below are accordingly modified to the extent that the addition on account of disallowance for paying salary to Shri Amandeep Kumar....
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....ontention of the assessee and dismissed this ground of appeal. The findings of the learned Commissioner of Income-tax (Appeals) in para 5.3 of the appellate order are reproduced as under : "5.3 I have carefully considered the appellant's submission. The appellant has claimed that Rs. 15,00,000 was paid to M/s. Indo Construction on March 26, 2007 as advance for purchase of crane and after negotiation the rate was settled for Rs. 11,60,000. Rs. 3,40,000 was received back by the appellant on April 12, 2007. The appellant submitted a copy of account of M/s. Indo Construction in its books. The account reads as under : Date Particulars Voucher type Voucher No. Debit Credit 1.4.2007 To advance for crane trf. from advance for crane Ch. No. 170935 for P. N. Bank Journal 03 15,00,000 By crane (Indo Const.) Journal 04 11,60,000 12.4.2007 P.N.B.O/A0765002100432354 Receipt 04 3,40,000 15,00,000 15,00,000 In support of its claim for purchase of crane, the appellant sub mitted the bill issued by Indo Construction. As per this bill dated March 24, 2007, the crane has been sold to the appellant for ....
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....2007 advance was shown against M/s. Indo Construction through cheque No. 170935 in P.N. Bank. Therefore, the advance is given by the assessee to the seller through banking channel. On the same date on April 1, 2007, another entry is made of Rs. 11,60,000 for crane. The copy of the same ledger account is filed at page 12 of the paper book, which further explained that the cost of the crane was Rs. 10,40,000 and Rs. 1,20,000 was the cost of loading of the crane from Delhi to Ludhiana and transportation, etc. Thus the total cost of the purchase of crane was Rs. 11,60,000. The rest of the advance amount of Rs. 3,40,000 was returned to the assessee on April 12, 2007 through banking channel. The copies of the purchase bill dated March 24, 2007 of crane is filed on page 13 of the paper book and the cost of transportation, loading and unloading of the crane dated March 24, 2007 is filed at page 14 of the paper book. The learned Commissioner of Income-tax (Appeals) found contradiction in the submission of the assessee because the assessee claimed that the crane was purchased on April 1, 2007 as per the ledger account but the purchase bill shows the date of sale as March 24, 2007. There is n....