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2016 (1) TMI 1031 - AT - Income TaxDisallowance of wages - CIT(A) allowed relief to assessee - Held that:- The assessee has given a reasonable and plausible explanation that the assessee is a civil contractor and hires worker who are mostly illiterate and cannot sign and instead use their thumb impressions and wage register was duly audited by the auditors who have not pointed out any defect or deficiency in the wage register. The AO has also not also specified any authority of law whereby it is mandatory in India on the part of the payer to compulsorily have signatures of the payee's in the receipts/ vouchers instead of thumb impressions and taking of thumb impressions of the payee will invalidate or lead to inadmissibility/ rejection of the documents under prevailing laws in India nor the AO has brought any authority under Act that if revenue stamp is not affixed on cash payments exceeding the prescribed limit under law, will lead to disallowance of the said expenses under the Act. No doubt, this could be deficiency in the maintenance of records but that is not sufficient to disallow the claim of expenses of the assessee. Nor is the case of the revenue that these expenses are bogus or fictitious and have never been incurred or paid by the assessee. Thus, we are of considered view keeping in view the facts and circumstances of the case, that ad-hoc disallowance being 15% of the wages made by the AO cannot be sustained and we are not inclined to interfere with the orders of the CIT(A). - Decided against revenue Assessment u/s 144 - disallowance deleted by CIT(A) - Held that:- AO erred in not considering the replies filed till 16-12-2011 by the assessee during the course of assessment proceedings in tapal/dak counters before the finalization of the assessment u/s 144 of the Act on 16-12-2011 while the CIT(A) has rightly considered the replies filed by the assessee in tapal/dak counters till 16-12-2011 i.e. date of finalization of the assessment u/s 144 of the Act by the AO. The CIT(A) has adjudicated the appeal of the assessee on merits after considering the replies, documents and evidences furnished by the assessee till 16-12-2011. We found no infirmity in the orders of the CIT(A) which we uphold - Decided against revenue
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