TaxTMI 
TaxTMI 
2018 (11) TMI 993
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..... 3. Brief facts of the case are that the assessee at the relevant time was engaged in the business of road-construction. It has filed its return of income on 28.9.2013 electronically declaring total income at Rs. 72,09,250/-. The case of the assessee was selected for scrutiny assessment and notice under section 143(2) was issued and served upon the assessee. On scrutiny of the accounts it revealed to the AO that the assessee has shown total receipt of Rs. 24,74,51,027/- on which net profit of Rs. 71,670,948/- has been declared. It is pertinent to observe that the assessee is used to get contracts from AUDA and AMC etc. It was noticed by the AO that the assessee has debited an amount of Rs. 6,77,69,053/- towards labour charges which inclu....
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....assessee. 4. The ld.counsel for the assessee while impugning orders of the ld.Revenue authorities contended that the assessee has established direct link between the work obtained from government instrumentalities i.e. AUDA and AMC, and how these works have been got performed by it with the help of labour contractors. Complete ledger details exhibiting the nature of contract obtained from these agencies, and assignment to the labour contractor has been filed. The ld.counsel for the assessee took us through page nos.42 to 47 of the paper book, where the details of bills, nature of work, rates and how these works have been carried out are being placed on record. He thereafter made reference to the bank statement vide which the payments have ....
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....considered rival submissions and gone through the record carefully. It is pertinent to observe that in order to claim expenditure under section 37(1) of the Act, the assessee is required to fulfill certain conditions viz. (a) there must be an expenditure, (b) such expenditure must not be of nature described in sections 30 to 36, (c) expenditure must not be in the nature of capital expenditure or personal expenditure of the assessee, and (d) expenditure must be laid out or expended wholly and exclusively for the purpose of business or profession. Expression "wholly" employed in section 37 relates to quantification of the expenditure, while expression "exclusively" refers to the motive, objects and purpose of the expenditure. If we make an an....
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....rom AUDA or AMC and completion of work. Thus, actual expenditure must have been incurred on such work. Can the claim of the assessee be belied simply for the reasons that some of the labour contractors were not having complete knowledge of the contract which is being looked after by their husband ? To our mind, the ld.Revenue authorities have failed to appreciate actual circumstances of the dispute. Considering the above details, we allow this ground of appeal and delete the impugned disallowance. 7. In the next ground, grievance of the assessee is that the ld.CIT(A) has erred in confirming the disallowance of depreciation amounting to Rs. 5,35,000/-. 8. The assessee has claimed deprecation on plant & machinery. According to the AO, the ....
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.... it is observed that provisions of section 32(1)(iia) granting additional depreciation reads as under: "32(1)(iia)..... in the case of any new machinery or plant (other than ships and aircraft), which has been acquired and installed after the 31st day of March, 2005, by an Assessee engaged in the business of manufacture or production of any article or thing or in the business of generation or generation and distribution of power], a further sum equal to twenty per cent of the actual cost of such machinery or plant shall be allowed as deduction under clause (ii): Provided that no deduction shall be allowed in respect of- (A) any machinery or plant which, before its installation by the Assessee, was used either within or outside India b....
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....reciation on the vehicle used for construction business. According to the assessee, originally a claim for depreciation at the rate of 15% was made where vehicles used in construction business are eligible for depreciation at the rate of 40%. Thus, the dispute between the assessee and the Revenue is, whether depreciation is to be granted at the rate of 15% or 40%. The ld.Revenue authorities have disallowed the claim by holding that the assessee has been claiming additional depreciation which is available to an assessee engaged in the manufacturing activity. In support of his contentions, the ld.counsel for the assessee relied upon the order of ITAT in the case of DCIT Vs. Rakesh Jain,49 SOT 57 (Chand) wherein deprecation on tippers, vibrato....