2011 (6) TMI 978

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....hearing of this appeal, we have heard Shri Pradeep Kuamr Mitra, ld. Sr. DR for the Revenue and Shri Ajay Tulsiyan, ld. Counsel for the assessee. The crux of arguments on behalf of the Revenue is that during assessment proceedings, it was observed from the P & L account that certain expenses increased disproportionately as compared to sales, for which, our attention was invited to para 9.1 of the assessment order by further submitting that there was increase of expenses upto 170%. Some of the expenses were argued to be non-verifiable of certain parties or the persons to whom the assessee made payments of the colliery and godown expenses, therefore, the disallowance, so made, was argued to be justified. On the other hand, the ld. Counsel for ....

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....t and the comparison of expenses has been made with reference to sales. However, on appeal, the ld. CIT(A) considered the submissions of the assessee, which are available at pages 27 to 29 of the paper book and concluded as under: "4.2 Coming to the next issue of disallowance of colliery and godown expenses at ₹ 14 lakhs, the appellant in detailed written submissions filed which were also submitted before Assessing Officer has emphasized that increase in colliery expenditure was for the reason that the appellant company started procuring Indian coal from South Eastern Coal Ltd. (SECL) and Mahanadi Coal Ltd. (MCL) which was not free from stones etc, and hence workers had to be paid for picking stones etc., and major portion of such e....