TMI Blog2015 (8) TMI 1088X X X X Extracts X X X X X X X X Extracts X X X X ..... owever, considering the fact that Shri Amandeep Kumar was not qualified as against the qualification of other son Shri Daniel, it would be reasonable and appropriate to restrict the salary paid to Shri Amandeep Kumar slightly lesser as was given to Shri Daniel because both of them were doing the same job for the assessee. Thus it would be appropriate to allow salary paid to Shri Amandeep Kumar in a sum of ₹ 1,50,000 as against the payment of salary of ₹ 2,25,000, thereby the addition is restricted to ₹ 75,000 only. - Decided in favour of assessee in part. Disallowance of depreciation on crane - Held that:- If the Assessing Officer was having any doubt in his mind regarding the purchase of the crane by the assessee from M/s. Indo Construction, the Assessing Officer should have verified any fact from the seller. The Assessing Officer has failed to note that all the transactions have been done through banking channel and as such, it is unbelievable that the assessee has not purchased the crane in question. The authorities below have also failed to note that after purchase of the crane in question in assessment year under appeal, the total receipts of the assessee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee challenged the addition before the learned Commissioner of Income-tax (Appeals) and written submission is quoted in the impugned order, in which the assessee briefly explained that the assessee is approximately 57 years of age and is engaged in the business/profession of providing services of crane on job work basis for construction of bridges, heavy load machinery and in uplifting of machinery in furnaces meaning thereby the business/profession of providing the services with the aid of cranes which can basically be done by the young and energetic persons. The cranes could not be operated by every labourer and need experience to operate the same. Any mishappening of the cranes can cost in lakhs of rupees for its repair and maintenance. The safety of the cranes is also required. The assessee could hire the services from outside sources but which would cost more. The sons of the assessee would be in a better position to take care of the cranes. Therefore, the salary paid to them was quite genuine and reasonable. The salary paid to Shri Daniel, who is a mechanical engineer and has knowledge, the salary was reasonable in the present assessment year. The total receipts of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... idering the fact that Shri Amandeep Kumar was not qualified as against the qualification of other son Shri Daniel, it would be reasonable and appropriate to restrict the salary paid to Shri Amandeep Kumar slightly lesser as was given to Shri Daniel because both of them were doing the same job for the assessee. Considering the above discussion, it would be reasonable and appropriate to allow salary paid to Shri Amandeep Kumar in a sum of ₹ 1,50,000 as against the payment of salary of ₹ 2,25,000, thereby the addition is restricted to ₹ 75,000 only. The orders of the authorities below are accordingly modified to the extent that the addition on account of disallowance for paying salary to Shri Amandeep Kumar would be restricted to ₹ 75,000 only. 8. In the result, this ground of appeal of the assessee is partly allowed. 9. On ground No. 3, the assessee challenged the addition of ₹ 1,74,000 on account of disallowance of depreciation on crane. 10. The brief facts are that the Assessing Officer noted that the assessee had claimed depreciation of ₹ 1,74,000 at 15 per cent. on a crane, which has been shown to have been purchased on April 1, 2007 f ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r ₹ 11,60,000. ₹ 3,40,000 was received back by the appellant on April 12, 2007. The appellant submitted a copy of account of M/s. Indo Construction in its books. The account reads as under : Date Particulars Voucher type Voucher No. Debit Credit 1.4.2007 To advance for crane trf. from advance for crane Ch. No. 170935 for P. N. Bank Journal 03 15,00,000 By crane (Indo Const.) Journal 04 11,60,000 12.4.2007 P.N.B.O/A0765002100432354 Receipt 04 3,40,000 15,00,000 15,00,000 In support of its claim for purchase of crane, the appellant sub mitted the bill issued by Indo Construction. As per this bill dated March 24, 2007, the crane has been sold to the appellan ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee for the preceding assessment year ending on March 31, 2007, in which under the head Loans and advances as on March 31, 2007 a sum of ₹ 15 lakhs had been shown as advance for crane. It would mean that in the preceding assessment year the assessee has given advance of ₹ 15 lakhs for purchase of crane. The assessee submitted copy of account of M/s. Indo Construction in the books of the assessee before the learned Commissioner of Income-tax (Appeals), which is reproduced above. It would show that on April 1, 2007 advance was shown against M/s. Indo Construction through cheque No. 170935 in P.N. Bank. Therefore, the advance is given by the assessee to the seller through banking channel. On the same date on April 1, 2007, another entry is made of ₹ 11,60,000 for crane. The copy of the same ledger account is filed at page 12 of the paper book, which further explained that the cost of the crane was ₹ 10,40,000 and ₹ 1,20,000 was the cost of loading of the crane from Delhi to Ludhiana and transportation, etc. Thus the total cost of the purchase of crane was ₹ 11,60,000. The rest of the advance amount of ₹ 3,40,000 was returned to ..... X X X X Extracts X X X X X X X X Extracts X X X X
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