TaxTMI 
TaxTMI 
2023 (10) TMI 1241
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....cause of Low Drawings which needs to be deleted. 6. The CIT (A) has wrongly confirmed action of AO for not allowing deduction u/s 80C of Rs 1.00 Lac which needs to be allowed. 7. The CIT (A) has wrongly confirmed @20% of disallowance under the head Salary, Daily Allowance and Festival Expenses & @10% of other expenses under the head of Telephone, Vehicle. General, Travelling, Business Promotion, Staff Labour Cost of Uniform which needs to be allowed. 8. That appellant reserves its right to add/delete/amend/rectify any of the ground of appeal mentioned above before the hearing and during course of hearing." 3. None appeared for the assessee even after serving several notices to the registered address of the assessee. The assessee also engaged the service of Chartered Accountant who has filed the power of attorney, but both the Assessee as well as the representative of the Assessee remained absent before the Tribunal, therefore, we are compelled to decide the captioned appeal on hearing the Ld. Departmental Representative and after perusing the material available on record. 4. Brief facts of the case are that, the assessee who takes the parking sites ....
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....eipt of Rs. 5,36,52,236/-, thereby shown only 0.1% net profit on the gross parking receipts. The assessee debited Rs. 50,57,744/- under the head of salary and Rs. 45,83,581/- and under the head of wages. The Ld. A.O. found that the assessee is paying almost 24% of gross receipt on salary and wages. The assessee was asked to furnish the details of employees, their attendance register, payment schedules and proof of payment. On verifying the list of employees provided by the assessee, the A.O. found that the assessee is paying the maximum employees more salary than maximum taxable income and also found that the assessee is paying more than 20,000/- per month to 12 employees found that the assessee has shown two payments of less than 20,000/- twice in every month. Since the payment of salary twice in a month is impractical and the same is found be arrangement of cash income-adjustment made by the assessee to suppress the profitability. In the absence of any concrete evidence regarding the payment made on account of salary/wages and bonus and in the absence of producing complete books of account with supporting vouchers/bills and considering the violation of ESI/PF registration, though....
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....d by the appellant * Appellant was working on different locations at four sites but attendance register of all the workers was common which was humanly impossible to sign at one place. * The appellant was not having any PF/ESI registration number despite the fact that forty employees and workers are claimed to have been working under him. * The rate of unskilled workers at parking sites as per minimum wages Act is Rs. 19,15,056/- for twenty two workers against the claim made by the appellant of Rs. 45,83,581/-. 6.2.2 The appellant, on the other hand has claimed in the written submission mentioned supra in para 5 that the AO have not disputed the genuineness of the expenditure claimed but made the disallowance to curb the possible revenue loss and filed many decisions in his favour in support of the ad-hoc disallowances which is made. 6.2.3 The appellant has also claimed that the ledger account of salary, bonus and staff fooding and boarding was produced before the AO. Similarly, for wages the appellant has claimed that identity proof of twelve workers were produced and there is no valid basis for disallowance on this account. Further, th....
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....ng such disallowance including the disallowance made in ground no. 9 of Rs. 14,39,114/-, the net profit of the appellant comes to Rs. 36,39,114/- which is @6.78% of the gross receipt of Rs. 5,36,52,236/- and is reasonable considering the business of the appellant." 10. The assessee has not produced books of account and other supporting evidence before the A.O. or CIT(A) to substantiate the expenses claimed under the head of salary and wages. It is the duty of the assessee to produce his books of account and supporting evidence before the A.O. to substantiate the claim of the returned income, it is for the assessee to produce cogent evidence in support of low profit shown in the return of income, failing which the A.O. is the duty bound to make the disallowance. The Ld. CIT(A) by taking into consideration that the net profit of the Assessee's business has been taken by the A.O. of Rs. 83,44,963/- (Rs.89,29,310/- - 5,84,388/-) after deducting the interest on FDR which is at 15.55% on the gross receipt of Rs. 5,36,52,236/- which is held to be excessive, therefore, rightly restricted the disallowance made by the A.O. under the head of salary from 25,28,872/- to 12,00,000/- and disal....
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.... substantiate his claim, the A.O. rightly made the addition which has been confirmed by the CIT(A), thus we find no merit in Ground No. 6 of the assessee, accordingly, the Ground No. 6 of the Assessee is dismissed. 14. Ground No. 7 is regarding disallowing at 20% under the head of salary, daily allowance and festival expenses and disallowance of 10% of other expenses under the head of telephone, vehicle, general, travelling, business, promotion, staff labor cost of uniform. During the assessment proceedings, the assessee was asked to produce the complete books of accounts, documents with supporting vouchers and bills to substantiate the claim by the assessee has not produced the books of account and in the absence of books of accounts, the assessee had debited his profit and loss account on following expenses:- "Telephone Expense Rs. 83,255/- Vehicle Running & Maintenance Rs. 71,540/- General Expense Rs. 29,512/- Travelling & Conveyance Expense Rs. 1,88,751/- Business Promotion Exp. Rs. 58,650/- Staff and Labour Welfare Rs. 3,02,750/- Cost of Uniform Rs. 78,145/- Festival celebration expense Rs. 6,25,151/- Daily allowance Rs,....