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2022 (12) TMI 3 - ORISSA HIGH COURTPrice escalation clause - Remand of the case for re-examining the issue concerning labour and service charges and amount allegedly received as hire charges by the Assessee for the year 1996-97 - deductions towards labour and service charges can be limited to 34% in the 1st year of the project work which is to be completed within a period of five years or not - whether petitioner in execution of works contract has received any amount towards hire charges? HELD THAT:- As rightly pointed out by learned counsel appearing for the Petitioner, the above percentages were indicative of the escalation that was permissible on these items in terms of the agreement and did not reflect on the actual expenditure incurred on the ground of labour and services. On the other hand, the books of account produced by the Petitioner-Assessee were accepted as such both by the STO as well as the ACST. They examined the books of account thoroughly and found that the amounts were properly accounted for. In fact, the STO also noted that the Assessee had produced “Labour payment register, vouchers, Cash book, muster rolls and copies of the trial balance (audited) for the year 1996-97.” With both the STO and the ACST having accepted the books of account produced by the Assessee without any reservation, there was no occasion for the Tribunal to have limited the labour and service charges to 34%. Hire charges purportedly received by the Assessee - HELD THAT:- The fact remains that no material whatsoever was produced by the Department to substantiate even prima facie that the Assessee had received that amount. In fact, the Tribunal notes that the Assessee disputed having ever received such an amount. There was accordingly no occasion again for the Tribunal to have remanded this issue to the STO for determination - decided in favour of the Petitioner-Assessee and against the Department. Revision petition allowed.
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