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2013 (5) TMI 715 - AT - Income TaxDisallowance of wages paid to labour - CIT(A) dissatisfied with the quality of the vouchers maintained and furnished by assessee - AO adopted disallowance as 8% confirmed by CIT(A) by holding that such an addition will bring the NP to the level of 5%, which is reasonable one and which is close to the NP for the AY 2006-07 - Held that:- AO examined the quality of the self-made vouchers issued by the mukadams and noted that the same contains the name of the mukadams and the measurements particulars and the number of days and the amounts, TDS particulars, the signature of the mukadams, also the name of the employee of the company to prepare the vouchers etc. Further, the said vouchers are cash vouchers, no addresses of the mukadams is given, no IT particulars mentioned, no PAN number are details is given and the basic details regarding the addresses of the mukadams for facilitate issue of notices for conducting queries if any were not available. It is also the fact that there is fall in the GP Rs. 5.75% and NP Rs. 4.03% no specific reasons are mentioned for the said fall. It is also noted that labour expenses amount substantially with compare to the some debits for the AY 2006-07. These facts indicate that all is not well with this account. It is also undisputed fact that the AO has not justified for adopting 8% for making disallowances. In these circumstances, there is a need for some disallowances in these account therefore making disallowance of Rs 2 lakhs must meet the ends of the justice. Accordingly Assessee ground no.1 is allowed in part.
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