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2016 (4) TMI 468 - ITAT AHMEDABADAddition on account of unexplained increase in the wages and salary as compared to the increase in production - CIT(A) deleted the addition - Held that:- Lease rental were paid and TDS were deducted and in the ledger account, copy of lease rentals were shown under the head service charges. The copy of the account and details were also furnished. These details were sent to the Assessing Officer for his comments vide letter dated 23.03.2010 and 19.08.2010. Before the CIT(A), the assessee has also submitted that revenue stamp was affixed when payment exceeded ₹ 5,000/-, the employment of labourers was evident from the PF record as well and there was increase in production and the gross profit rate was better than the last year; and therefore, no addition was called for. Agreed with the contention of the assessee, the CIT(A) granted relief to the assessee by observing that the assessee has taken machines on lease and has been paying lease rentals after deducting TDS. Further, he observed that there was increase in production during the year under consideration and the gross profit rate was also better. The CIT(A) also held that the addition could not be made merely because of increase in wages was not proportional to increase in production. Accordingly, he rightly deleted the addition in question by observing that the Assessing Officer was not justified in disallowing the wages and making such addition in question. - Decided in favour of assessee
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