TMI Blog2005 (8) TMI 587X X X X Extracts X X X X X X X X Extracts X X X X ..... For immediately preceding asst. year, the assessee has declared net profit of 6.08 per cent on gross receipts of Rs. 154 lakhs. The assessee claimed deduction of Rs. 46,90,354 being clearing expenses paid to labourers of New Mangalore Port Trust (NMPT). The said payment was made to unlisted labourers operating in the Port Trust. The Assessing Officer asked the assessee to produce necessary evidence in support of its claim. The assessee furnished explanation vide its letter dated 23-1-2001. After considering the reply of assessee, the Assessing Officer held as under:- "The assessee s explanation is not acceptable since the labour charges in respect of clearing and forwarding expenses are taken care of by the New Mangalore Port Trust Reg ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... py of agreement between the Management of NMPT and representative of Unions representing Cargo Handling workers. It was submitted that the payment is required to make as per the terms of said agreement and assessee has to necessarily hire unlisted workers. The services are procured through gang leaders and gang leaders have signed the vouchers at the time of receiving the payments. Learned CIT(A), after considering the submission of assessee, held as under:- "I have gone through the above order passed by the Hon ble Settlement Commission. However, it is found that the claim relating to the payments made to the non-listed workers in the above case for the assessment years 1988-89 to 1993-94 varied from 15 per cent to 70 per cent of the tot ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not judicious. The CIT(A) ought to have appreciated the fact that the Assessing Officer has made the disallowance after considering all the evidences/vouchers produced by the assessee at the time of assessment proceedings. The CIT(A) has failed to realize the fact that the payment to unlisted workers was Rs. 46,90,354 as against Rs. 42,47,722 to listed workers which is most unrealistic. The CIT(A) has erred in applying the decision of Settlement Commission in the case of M/s. Evergreen Suppliers to this case. The decision of Settlement Commission was based on different facts and circumstances. This cannot be considered as a basis for relief in this case. 2.4 Learned counsel for assessee on the other hand submitted that in view of the i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred wholly and exclusively for the purpose of business or not so incurred. We accordingly delete the disallowance in respect of payments made to unlisted workers engaged by the assessee. 4. The next issue in both the appeals is against deletion of partial disallowance in respect of incentive paid to Trailer Drivers, Crane Operators etc. 4.1 The assessee claimed expenditure towards incentive to Crane Opera-tors, Drivers etc. The Assessing Officer disallowed the entire payment holding that evidence in support of such expenses has not been produced. Learned CIT(A) on the facts and circumstances, restricted the disallowance to 50 per cent of Rs. 2,64,620. The revenue as well as the assessee challenges the order of learned CIT(A). ..... X X X X Extracts X X X X X X X X Extracts X X X X
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