TaxTMI 
TaxTMI 
2024 (2) TMI 1388
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....ommon and connected and the appeals were heard together, these are being disposed off by this common order. 3. Grounds are common in all the appeals. We may refer to the grounds of appeal of AY 2010-11 as under :- "1. On the facts and in the circumstances of the case and in law, the CIT (A) has erred in deleting the addition by holding that no disallowance is required to be made for the payments to contractors for loading, unloading and packaging. 2. On the facts and in the circumstances of the case and in law, the CIT (A) has erred in allowing the appeal of the assessee without going into the merits of the case. 3. The order of the CIT (A) is erroneous and is not tenable on facts and in law." 3. Brief facts....
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....s were not found operating from these addresses. Accordingly, AO has made disallowance for the amounts paid to these persons and disallowance of such expenses is as under :- Sr.No. AY Disallowance of Expenses 1. 2010-11 Rs. 7,46,44,339/- 2. 2011-12 Rs. 10,03,81,463/- 3. 2012-13 Rs. 10,17,94,744/- 4. Against this order, assessee appealed before the ld. CIT (A). Ld. CIT (A) elaborately considered the issue and thereafter, he obtained written submissions from the assessee and obtained remand report from the AO also. Finally, he deleted the addition by holding as under :- "First main basis of the addition is revolving around the non existence of the alleged contractor at the address mentioned in t....
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....e remand, proceedings, when sixth labour contractor Sh. Satyabir Singh was produced before the assessing officer, he also explained that he has left the address where enquiry was done during search and post search proceedings, and shifted to the native place. He also stated that he was earlier residing at Sardar complex in Nasik and there is a rental agreement for the same. The relevant portion of statement is reproduced as under:- "Ql4. You could not be found during the search and survey operations and moreover during post search investigation and even during assessment proceedings. Please explain? Ans. I had left the work with the company at that time. I went to my village in May 2010 itself. The investigation and enquir....
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....g Officer is that these contractors are Ex-employee of the company. There is no denial to the fact that these contractors were ex-employee or town persons. The contractors have also accepted these facts. Ld. AR argued that for continuous supply of labour, only reliable and known person can be deployed. Fourth basis relied by AO is that in the computer of the appellant bills of these contractors were found. All the contractors have stated that the bills were prepared at the premise of the appellant as these contractors were only supplying labour and does not have separate infrastructure. The only issue remains whether being known person as contractor, there is excess payment towards services rendered by the contractors. In this regard, Ld AR....
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....ings, 5 out of 6 contractors were produced before the AO and statements of these contractors were recorded by the AO. All of them confirmed that they have provided labour to the assessee company for packing and loading of finished product. Furthermore, before the ld. CIT (A), assessee produced the sixth contractor whose statement was also recorded. In his statement, he confirmed to have supplied labor for packing, loading and unloading. 6.1 Furthermore, another plank of AO is that the employee of the assessee company used to withdraw cash from the contractor's bank account. Ld. CIT (A) has noted that he has perused the banks accounts and the entries of withdrawal were self. Therefore, he held that cash withdrawn by the contractors and th....