2022 (1) TMI 788

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....her - On facts and in law, 1) The learned CIT (A) has erred in confirming the disallowance made by the learned A.O. from payment of Labour Charges. The disallowance of labour charges were made merely on ad hoc/estimated basis to the tune of Rs. 14,95,431/- ignoring the facts submitted and assigning any specific reason. This amount was worked out being 5% of the total Labour Charges of Rs. 2,99,05,616/-. 2) The learned CIT (A) erred in not following the ratio of the Pune ITAT decision in the case of the appellant company for preceding previous years. 3) The appellant craves leave to add, alter, amend or delete any of the above grounds of appeal and/or to lay the additional evidences at the time of hearing." 3. B....

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....ng 5% of the total labour charges of Rs. 2,99,05,616/-. The Assessing Officer also extracted the scanned images of vouchers in the assessment order. Even on appeal before the ld. CIT(A), the findings of the Assessing Officer are confirmed. We have carefully gone through the orders of the lower authorities and the scanned images of the vouchers as extracted by the Assessing Officer in the assessment order, it is evident that the vouchers are duly signed by the payees. It is a trade practice in the line of business of civil constructions, the vouchers in respect of labour charges are always self-made. The identical issue dealt by the Co-ordinate Bench of this Tribunal by the same combination in the case of B.C. Biyani Project Pvt. Ltd. vs. JC....

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....ble Rajasthan High Court in the case of CIT vs. Consulting Engineering Group Ltd., 365 ITR 284 held that in the absence of evidence of bogus payment, the disallowance of part of payment on estimate basis was held to be unjustified. Further, the jurisdiction of the ld. CIT(A) is only confined to deciding the reality of the expenditure which means the ld. CIT(A) has to render a finding as to whether the amount claimed as deduction was actually expended or laid out wholly or exclusively for the purpose of business. The reasonableness of the expenditure should be gone into only for the purpose of determining whether the amount was paid. 23. In the present case, nothing is discernable from the perusal of the order of the ld. CIT(A) that....