TaxTMI 
TaxTMI 
TaxTMI 
2015 (10) TMI 472
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....te order deleting addition of Rs. 17,30,383/- under the head " labour charges shown payable". The assessee's audit report had shown this sum as provision on current liabilities. The Assessing Officer was of the view that it had debited wages sums of Rs. 8,73,734/- for February and Rs. 10,56,649/- in March month and paid only Rs. 2 lacs to workers in former month. The assessee quoted delay to non-receipt of job work charges. The Assessing Officer held in assessment order dated 24-12-2009 that assessee's payment of Rs. 2 lacs was only Rs. 918/- per labourer which was very much insufficient to make both ends meet. He inferred that the assessee must have made payments to his labourers out of his books. He reduced the paid sum of Rs. 2 lacs acco....
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....he month of March 2007 and also submitted the correct amount of labour payment for the last quarter of the year works out to Rs. 3,159/- per labourer per month in the following manner. Month Labour Payment (Rs.) No. of labourers Average Payment per worker (Rs.) February 2007 8,71,410 109 7,995 March 2007 2,00,000 135 1,481 10,71,410 9,476 Total No. of months Payment per labourer month (Rs. 9,476 / 3 months) 3 3,159 In view of the above, the AR of the appellant contended that the AO has made the impugned addition on a wrong footing and in fact the average labour payment per labourer per month works out to Rs. 3,159/- as shown in the above table, which under no circumstances can be cons....
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....basis on which the addition has been made is AO's presumption that the amount of labour payment per labourer per month of Rs. 918/- is very low on which the labourers cannot sustain their family. The law does not permit for addition on the basis of such reasoning such addition should be avoided. Accordingly, I am of the opinion that the AO is at all not justified in presuming that the appellant might have made labour payment outside the books and therefore, I hereby delete the addition of Rs. 17,30,383/- as made by the AO for outstanding labour payments as at the year end. In the result, Ground of Appeal No. 1 of the appellant is allowed." 4. The Revenue strongly reiterates the Assessing Officer's inference drawn of labour payments of....
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....ugh diamonds. Accordingly, it was contended that even in the activity of diamond cutting by laser machines on job-work basis, the diamond marker machines are used to first plan the shape, size and design and thereafter, cut it through the laser machines and hence, it cannot be alleged that the diamond marker machines are of no use in the diamond cutting activity carried out by laser machines. The AR further submitted that over and above the diamond laser cutting activity, he is also engaged in the business of importing of rough diamonds, manufacturing of polished diamonds and sales thereof, in his proprietary concern M/s. Amrutlmpex and the said activity has been reported by the statutory auditor in Clause No. 8(a) of the Tax Audit Report a....
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....t be denied in the subsequent year, on the ground that one of the asset of the said Block of Asset, was not used by the assessee in the said subsequent year. In support of this argument, reliance was placed on the decision of ITAT, Mumbai, in the case of Unitex Products Ltd. Vs. ITO (2008) 22 SOT 429 (Mumbai). In view of these submissions, the AR of the appellant pleaded that the disallowance of depreciation as made by the AO needs to be deleted. 5.2. I have considered the facts of the case, the order of the AO and the submissions of the appellant. It is seen that the Diamond Marker Machines are used to plan the shape, size and design in which the rough diamond is to be cut so as to get the maximum yield of polished diamonds and minimum r....