2025 (7) TMI 380

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... appellant-assessee has challenged judgment and order dated 11.04.2007 passed by Income Tax Appellate Tribunal, Rajkot Bench, Rajkot (For short "the Tribunal") in Income Tax Appeal No.829/RJT/2004 for Assessment Year 2001-2002. 3. This Tax Appeal was admitted vide order dated 31.01.2008 for consideration of following substantial question of law: "Whether on the facts and in the circumstances of the case the Tribunal is right in law in restoring the addition of Rs. 10,81,248/- made under Section 69C on account of payments made to labourers?" 4. Brief facts of the case are that the appellant is an individual and is engaged in the business of supply of labourers on contract basis. 5. For the Assessment Year 2001-2002, the return of incom....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....and, therefore, the relevant amount has to be added to the income. It is this finding of the AO which does not appear to be very logical and correct. This is because once he admits that the picture reflected by balance sheet is not correct how can he give a finding which is again based on the said balance sheet. The appellant had sufficient cash balance available with him as per books of account right from Oct 2000 to Mar 01. Therefore obviously the payment to labour would have been made from the said cash. I labour payment was made from some other source what was the need to withdraw & keep huge cash balance? The position reflected by b/s that huge cash was available with appellant does not seem to be correct according to facts and circums....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

....ecause even the amount of addition has been worked out only on estimate basis. The appellant had stated that about 80% of payment was already made but he did not mean that exactly 80% payment had been made. It could have been 75% or 85%. In substance, major part of the payment was stated to be made before Mar 01 for which cash was sufficiently available with the appellant. In view of this what ever part of payment made is treated to be made before 31/3/01 the same stands explained by cash balance in books & cannot be treated as having been made from undisclosed sources. Accordingly the entire addition of Rs 10,81,248 is deleted." 8. Being aggrieved, the appellant preferred an appeal before the Tribunal. The Tribunal after considering the ....

X X   X X   Extracts   X X   X X

Full Text of the Document

X X   X X   Extracts   X X   X X

.... balance sheet was not before the authorities assessment below during the course proceedings. of This fact is also apparent from the date when the balance sheet was compiled by the Chartered Accountants which is dated 19-08-2004 while the assessment has been completed by the AO on 31-3-2004. Even no evidence has been submitted that the copy of the revised balance sheet has been filed before the CIT (A) as the appeal has been concluded before the CIT (A) on 19-08-2004 itself. We have gone through the order of the CIT(A). The CIT(A), in our opinion, has simply deleted the addition ignoring the admitted facts that the payment has been made by the assessee was not recorded by the assessee prior to 31-03-2001. Even by submitted sheet balance ....