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TMI Blog2015 (11) TMI 573X X X X Extracts X X X X X X X X Extracts X X X X ..... f the learned Commissioner of Income-tax (Appeals) in respect of following three issues : (a) disallowance made out of salary and wages ; (b) disallowance made under section 43B of the Income-tax Act, 1961; and (c) addition of capital introduced by the assessee. 3. The assessee is in the business of undertaking civil contract works and interior decoration works. The first issue relates to disallowance of Rs. 9,14,660 made out of salary and wages expenditure. Learned counsel appearing for the assessee submitted that the assessee has claimed a sum of Rs. 11,01,560 as expenditure towards salary and wages. The Assessing Officer noticed that a sum of Rs. 9,14,060 has been paid to temporary workers by way of cash. Since the vouchers produced ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he maintenance of vouchers, particularly for the reasons that the assessee's work necessitates employment of sizable labour force. During the course of hearing, the learned authorised representative brought to our notice some of the vouchers placed in the paper book. He submitted that the signature or thumb impression of the workers have been obtained on the labour payment sheet itself. He submitted that this practice is generally followed in all the construction contractors, since local labourers are generally employed from the place of site itself. Considering the characteristics of contract works, we find some merit in the contentions of the learned authorised representative. Hence the disallowance of entire amount, in our view, is n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y the auditor in the value added tax audit report. The learned authorised representative submitted that the assessee has claimed input credit of Rs. 5,67,185. However, the value added tax auditor has restricted the same to Rs. 3,68,505. Similarly, the assessee had taken the value added tax amount paid by him as Rs. 7 lakhs. However, the value added tax auditor has taken the same as Rs. 8 lakhs. The abovesaid differences have resulted in showing of outstanding amount of Rs. 1,92,087. The learned authorised representative submitted that the value added tax payable, as per the assessee's calculation, was only Rs. 93,398 and it has been duly disallowed by the assessee in the return of income. Accordingly, the learned authorised representati ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e that he has not accepted the value added tax audit report. Having accepted the value added tax audit report, in our view, the assessee was not justified in denying the value added tax liability shown in the audit report. Further, the assessee has not shown to us that the computations given in the value added tax audit report was not accepted by the Sales Tax Department. Under these set of facts, we are of the view that the learned Commissioner of Income-tax (Appeals) was justified in confirming the addition of balance amount of Rs. 98,689 by invoking the provisions of section 43B of the Act. 12. The next issue relates to the addition of Rs. 51,000, being amount introduced by the assessee as his capital in the business books. The learned ..... X X X X Extracts X X X X X X X X Extracts X X X X
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