AI Drafter 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (6) TMI 114
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....nces of the case, the Tribunal was right in law in upholding a part of disallowance, viz. Rs. 2,00,000/- made out of the expenditure incurred on repairs by the assessee?" 2. The facts set out in the statement of case are : The assessee is a partnership firm engaged in the business of dredging sand and for that business it uses two dredgers. For assessment year 1989-90 the assessee claimed having incurred expenditure of Rs. 10,33,547/- towards cost of repairs of two dredgers which mainly pertain to replacement of steel plates in the buckets which are used for dredging. The major portion of the above expenditure was attributed to the cost of steel plates of the buckets that are actually utilized for dredging. The assessee claimed having pu....
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....Rs. 2,00,000/- on account of repairs. Thus the disallowance of Rs. 5,00,000/- was upheld. Therefore it is clear that out of Rs. 10,33,547/- claimed as expenditure for repairs, on account of Rs. 8,33,547/- was allowed as deduction. 6. Ms. Mehta, the learned counsel appearing for the applicant in support of the Reference submitted that the Assessing Officer, CIT(A) and the Tribunal had misdirected themselves in concluding that the assessee had not incurred the expenditure expenses of Rs. 10,33,747/- towards repairs. She submitted that the main reason for the aforesaid Revenue authorities to come to this conclusion was by virtue of the fact that they suspected cost of repairs to be inflated only on the basis of assumptions and presumptions ....
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....e the Income Tax Officer had rejected the claim of the assessee on the ground that the expenditure claimed was disproportionate to the income. 8. Mr. Suresh Kumar appearing for the revenue submitted that there was no substance in the assessee's case and that the question referred is not the question of law and more in the realm of fact. All the authorities had found in favour of the revenue and there is no justification in contending that the tribunal ought to have allowed the entire claim for repairs at Rs,10,33,547/-. It is submitted that from the facts as recorded in the order of the Assessing Officer, Commissioner of Income-Tax (Appeals) and the Tribunal it is evident that the assessee submitted no evidence whatsoever of the alle....
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....ce has been partial upto sum of Rs. 2 lakhs. The Tribunal has exercised its discretion in reducing disallowance from Rs. 5 lakhs by the Assessing Officer vide his assessment order dated 27th March, 1992 to Rs. 2 lakhs. The Tribunal being ultimate fact finding authority, we are not inclined to disturb those findings of fact unless the same are shown to be perverse. The contention of Ms. Mehta that the revenue had not established that the cost of steel plates and cost of repairs was inflated is not a submission which commends itself to us inasmuch as it was for the assessee to prove that dredging buckets were in fact repaired and that such repairs required purchase of steel plates and that steel plates were utilised for repair work of buckets....
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....any nature are seen to be produced in support of this contention. (B) The revenue had queried the assessee as to proceeds of scrap steel generated by the repair work. To this, the assessee contended that the scrap steel was lost mid-sea. This clearly is contention that is once again difficult to accept. There is no evidence to suggest that any such repair work of buckets was carried out mid-sea. Firstly, if dredging buckets had to be repaired, there was no reason for the dredger sailing midsea. After steel plates were purchased from M/s. J.K. Industries at Bhavnagar, as evident from the record, there is nothing to show as to why the repairs were not carried out at the ferry/wharf/port at which dredger was docked/moored. The contention th....