TaxTMI 
TaxTMI 
2016 (9) TMI 1665
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....was right in law in restricting the addition to 1.6% in respect of an expenditure which is of such nature as covered by section 37(1) of the Income Tax Act, 1961? (2) Whether under the facts and circumstances of the case, the Tribunal right in law in restricting the addition to 1.6% in respect of wages instead of 10.3% and 6.6% adopted by the assessing authority respectively for the assessment years 2002-03 and 2003-04, when the onus to prove the genuineness of expenditure claimed has not been discharged by the assessee"? 2. We have heard Mr. E.I. Sanmathi, learned counsel appearing for appellant and Mr. P. Dinesh, learned counsel appearing for respondent - assessee. 3. Learned counsel appearing for appellant has brought to o....
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.... at NMPT did not agree to work beyond the limit fixed by them, the assessee had engaged the services of the private workers and had made payment in cash to the extent of Rs. 1,17,59,931/- and through cheques to sub-contractors to the extent of Rs. 2,70,70,745/-; the payments were made through self made vouchers. According to the assessee, loading and unloading operations were carried out by it by making the following payments: (a) Rs. 2,53,29,660/- through cheque to NMPT Workers' Union. (b) Rs. 2,70,70,745/- to sub-contractors who brought the workers privately to the port for the purpose of unloading the iron ore. The payments were made through cheque to the sub-contractors. (c) Cash of Rs. 1, 17,59,931/- was ....
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....ted 30.4.2009 allowed the appeal of the assessee in part and restricted the addition to the extent of Rs. 15,00,000/- as against Rs. 2,94,00,000/- made by the Appellate Commissioner. 4. Sri Jeevan J. Neeralgi, learned standing counsel for the appellants as well as Sri S. Parthasarathi, learned advocate for the assessee have taken us through the entire material on record, more particularly the orders passed by the Appellate Commissioner and Income Tax Appellate Tribunal, Bangalore. 5. The Appellate Commissioner has in his detailed order clarified as to how the order passed by the Assessing Authority is unsustainable to the extent mentioned supra. To verify the genuineness of the payments made by the assessee to the sub-contractors thro....
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....in the matter of engaging the workers and payment of money to them as speed money. The letter written by the assessee to the Appellate Commissioner discloses that the total cargo handled during the financial year 2003-04 was 8,00,000 tons. On verification of the details obtained from the NMPT, Mangalore vide letter dated 17.10.2007, it was found that the details furnished by the assessee tallied with the details furnished by NMPT and hence the assessee was asked to explain as to whom payment of Rs. 2,70,70,745/- had been made and for what service. It is also found by the appellate Commissioner that all the statements of sub-contractors recorded by the Assessing Officer are of stereo type and same 18 questions were asked by the Assessing Off....
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....e was made, the amount was withdrawn by cash on the same day or on the next day. 6. In addition to the same, the Tribunal, on facts has found that the Appellate Commissioner did not find availability of any big labour force which can be engaged by assessee or any other cargo handling concern for the business. It is found that NMPT labour is so organized and strong that they would not allow any private subcontractors to carry on the work and receive the huge payments as indicated by the assessee in this case. It is also found by the appellate Commissioner that even the nature of work and infrastructure available at NMPT port does not require engagement of huge labour force of the nature indicated by assessee. Most of the cargo handling pr....