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TMI Blog2017 (3) TMI 973X X X X Extracts X X X X X X X X Extracts X X X X ..... h was added by the AO by making a disallowance with the aid of Section 40(a)(ia) of the Income Tax, Act, 1961. b. Ld.CIT(A) has erred in deleting the addition of Rs. 72,88,879/- which was added by the AO with the aid of section 68 of the Income Tax, Act, 1961. Issue no.1 3. The brief facts of the case are that assesse firm at the relevant time was engaged in the business of Civil Construction. It has filed its return of income on 31/10/2007, declaring total income of Rs. 23,940/-. Case of the assessee was selected for scrutiny assessment and notice u/s.143(2) of the Income Tax Act, dated 16/09/2008, was issued and duly served upon the assessee. On scrutiny of the accounts, it revealed to the Assessing Officer that assessee has shown G.P ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nship of a contractor and contractee between the payments of labour charges to the labourers. The assessing officer has unnecessary assumed existence of certain facts without their being any supporting materials. 6. The Ld. first appellant authority has accepted contentionsof the assessee and deleted the addition. 7. Before us,Ld.DR relied upon the order of the Assessing Officer. On the other hand the Ld.Counsel for the assessee pointed out that during the hearing beforethe Ld.first appellant authority, the assesseesubmitted all the details of payment and also emphasized that services of any sub-contractor was not availed. The Ld.CIT(A) has called for a remand report from the AO, directing him to verify some of the labourers. The Ld. AO d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re supplied by alabour contractors whereas stand of the assessee was that it itself employed all the labourer.It has handed over the labour payments to one or two person on the site who will disburse among the labourer. The assessee has not availed services of any labour contractors therefore, it was not required to deduct TDS. We could have appreciated the case of revenue, if assessing officer has inspected the site or record statement of labourers for establishing the facts that they worked at the site of assessee through some contractors but no such step was taken by the assessing officer,inspite of direction given by theCIT(A). Under these circumstance,the Ld.CIT(A) has deleted the addition and we do not see any reasons to interfere in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the address provided. The following need to be considered in this matter: a. The address House No 39/6, 336 LIG, GujHsg Board is a residential house which is owned and registered in the name of SMT JYOTI MANOJ GOHIL who is wife of the said Shri M D GOHIL. (Copy of the document enclosed). b. The Bank account is having the same address. c. The address in the department's record as per PAN is also the same as provided by the assessee. d. The present MOBILE no of Shri Manoj Bhai Gohil is 9898614342. e. All the POSTS are delivered to the said Shri Manoj Bhai Gohil at the same address. f. The Sub Contractor had made FDR(TDR) from his own Bank Account in favour of the Exec Engr Canal Division towards the Contract performance, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... peaks of the opportunity provided and time given. However the notice u/s 133(6) was finally served on the HIMALI on 18/12/09. 11. Whereabouts of Shri MD GOHIL: Only because a person does not turnout before the Assessing Officer it cannot be established the person is nonexistent more so when all other circumstantial evidences as available to the assessee are provided. The remarks of the LD Assessing Officer that the "assessee had tried to give it a colour of genuine transaction by deducting TDS on the payments made to HIMALI ENT, but unfortunately other evidence which has been collected during the assessment proceedings, points to the fact that the transaction with the HIMALI ENTERPRISES are non genuine transaction to reduce its taxable li ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e sub Contractor is enclosed herewith in which your good self can find that the payment made is directlylinked with the payment received. The payment can be traced with the receipt which is after deducting 1.75% profit margin and TDS. Under the circumstances it is prayed that the CREDIT BALANCE added to the Total Income u/s 68 may kindly be deleted'' 13. After going through the above submission the Ld. CIT(A) has deleted the addition. 14. With the assistance of theLd. representative we have gone through the record carefully. The assessing officer disbelieved existence of contractor/sub-contractor relationship between it and M/s. Hemani Enterprises. However, he has not assigned any reasons why he has disbelieved it. The assessee supplied ..... X X X X Extracts X X X X X X X X Extracts X X X X
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