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2016 (12) TMI 1803 - AT - Income TaxDisallowance of wages paid considering the same as excessive - HELD THAT:- AO simply disallowed 20% of the wage payment as excessive without supporting material and evidences to prove that the payment made to skilled workers was excessive. AO has not disproved the supporting vouchers and registers maintained by the assessee and other related supporting record maintained like provident fund and ESI contributions indicating the genuineness of these expenses. The observation made by the AO about excessive wage payment was of general nature ignoring the fact that wages were paid on the basis of number of working days. AO had not considered the fact that the nature of the business of the assessee relate to job work of mechanical and engineering on contract basis with organization like refineries, petrochemicals such as IPCL IOCL Gail. Some of the jobs were of highly labor intensive involving skilled and experienced physical labour force at the site of the work. - Thus AO is not justified in making disallowance - Decided against revenue. Payment of hiring charges for Hydra Machine at Barauni site - CIT (A) has deleted the disallowance made stating that the party to whom the payments was made not a related party and there was nothing on record to show that the part of the payment had been received back by the assessee - HELD THAT:- Disallowance made by the assessing officer in respect of hiring of crane payment to M/s Upendra Prasad Singh Hitech Construction Pvt. Ltd, in this connection we noticed that this disallowance was not based on cogent or justifiable reasons. We find that the hiring charges paid was not related to the persons covered under section 40A(2)(b) of the act and the assessing officer had made this disallowance on estimated basis without any supporting evidences to prove that the same was excessive and unreasonable. Considering the above facts and findings, we are not inclined to interfere in the findings of the Ld. Commissioner of Income Tax(A). - Decided against revenue. Disallowance u/s. 43B of service tax payable - HELD THAT:- Out of total service tax liability of ₹ 22,07,221/- only amount of ₹ 18,25,992/- service tax was paid on 5th July, 2008 and there was remark in the audit report that the sum for ₹ 3,81,229/- service tax was not due and hence not paid. We considered that there was no liability of the assessee to pay the above referred service tax as on 31-03-2008 and this service tax of ₹ 3,81,229/- was also not debited to the P & L a/c , therefore, the Ld. Commissioner of Income Tax(A) is justified in deleting the addition made by the assessing officer. - Decided against revenue.
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