TMI Blog2023 (4) TMI 684X X X X Extracts X X X X X X X X Extracts X X X X ..... , as noted above that the ld. CIT(A) partly concur with the findings of the AO that no supporting evidence was given. Before Tribunal, the assessee has neither given any evidence nor furnished the details of number of labourers, casual labours or their salary or attendance register to substantiate such claim. In absence of any evidence or explanation, find that the AO was quite justified in making addition/disallowance to the extent of 5% of the labour expenses. Therefore, uphold the orders of lower authorities qua this issue. In the result this ground of appeal is also dismissed. - ITA No. 105/Srt/2021 - - - Dated:- 22-3-2023 - SHRI PAWAN SINGH , JUDICIAL MEMBER For the Assessee : Shri Krutarth Desai , A. R. For the Department : Shri Vinod Kumar , Sr. DR ORDER PER : PAWAN SINGH , JUDICIAL MEMBER : 1. This appeal by the assessee is directed against the order of learned Commissioner of Income Tax (Appeals)-3, Vadodara, (in short, the ld. CIT(A)) dated 14/07/2020 for the Assessment year (AY) 2014-15 wherein the assessee has raised following grounds of appeal: 1. Assessment order and the first appellate order itself is bad in law, without appreciatio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... te of receipt of order. The ld. AR submits that he has two fold submissions; firstly, that the impugned order may have been received on the e-mail of advocate of the assessee who represented the assessee before the ld. CIT(A). But, such order was not immediately conveyed to the assessee. Thus, the assessee have no knowledge and could not file appeal immediately and secondly, the impugned order was passed on 14/07/2020 at that time, the pandemic of Convid-19 was in full swing and offices of various authorities were not functioning because of nationwide lockdown. The assessee and all his family members suffered by the infection and were in quarantine. The ld AR for the assessee submits that time period for filing appeal before the various forums/courts/authorities were extended by the Hon ble Supreme Court in suo moto writ petition No. 3/2020 dated 23/03/2020, which was modified from time to time and finally on 10/01/2022 and directed to extend the period of limitation for various compliances from 15/03/2020 to 28/02/2022 before various forums/ authorities and further grace period of 90 days time was granted to take resource of law, wherein the time limit of period of limitation was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... reciation on vehicle should not be disallowed. The Assessing Officer noted that no reply was furnished by assessee. Thus, the Assessing Officer disallowed depreciation of Rs. 6,91,621/-. 6. The Assessing Officer disallowed 5% of labour expenses by taking a view that the assessee has debited amount of Rs. 93,29,794/- on account of labour expenses. In the course of assessment, the assessee was asked to furnish the detailed bills with supporting evidences. Ongoing through such details, the Assessing Officer noted that most of the amounts were paid to casual workers and overtime workers and all the payments were made in cash. All expenses are not fully supported with proper vouchers and payment is incurred in cash. In absence of proper supporting and complete and want of verification, the Assessing Officer disallowed 5% of the expenses. The Assessing Officer worked out the disallowance of Rs. 4,66,490/- and added to the income of assessee. 7. Aggrieved by the additions/disallowances, the assessee filed appeal before the ld. CIT(A). On the disallowance of depreciation, the assessee submitted that the Assessing Officer disallowed the depreciation on the ground that the vehicle is o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... also made in A.Y. 2013-14 which was set aside by the ld. CIT(A) and on the same analogy, the disallowance may be deleted. 10. The ld. CIT(A) after considering the contention of assessee, held that the Assessing Officer has clearly mentioned that the expenses incurred for payment of casual labour are not supported by proper vouchers and supporting evidences. The assessee has produced self-made vouchers before the Assessing Officer. The Assessing Officer disallowed only 5% of the expenses for want of evidence. The assessee relied on the decision of his predecessor for the A.Y. 2013-14 wherein lump sum addition was deleted. The ld. CIT(A) held that from the assessment order, it is clear that no evidence was filed regarding payment of casual labour. The assessee could not substantiate the claim of expenditure. The ld. CIT(A) further held that he differed from the view taken by his predecessor, yet he concurred with the contention of assessee that lump sum addition is not fair. By making such observation, directed to examine the evidence regarding expenditure of Rs. 93,29,794/- on account of labour expenses and to disallow the expenses to the extent to which the assessee is unable to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal. No doubt, it has little persuasive value if it contains good and sound reasoning. The ld. CIT(A) in A.Y. 2013-14, allowed depreciation by holding that vehicle is used for the purpose of business and cannot be used for personal purpose. Thus, he has no reason to disbelieve the contention of assessee and allowed depreciation. I find that the ld. CIT(A) in A.Y. 2013-14, allowed relief to the assessee without verification of fact whether similar depreciation is claimed by son of assessee or not. No finding about the prime condition about the ownership was considered and discussed, therefore, I totally differ from the finding of ld. CIT(A) in A.Y. 2013-14 and concur with the finding of ld. CIT(A) for the year under consideration. The case laws relied by the ld. AR of the assessee are not at all applicable on the facts of the present case. 15. In Mysore Minerals Limited Vs CIT (supra), the depreciation was claimed on immovable property wherein the assessee was having possession and occupying the property and usufruct enjoyment in his own right like the owner. In CIT Vs Mohammad Bux Shokat Ali (supra), the vehicle was in the name of one of the partner of the assessee firm. In CI ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... labour expenses for want of proper evidence. The ld. CIT(A) held that for want of evidence, the addition made by Assessing Officer cannot be faulted. However, the ld. CIT(A) directed the Assessing Officer to disallow the expenditure to the extent which is not substantiated. As recorded above, before me, the ld. AR of the assessee submits that the similar addition was made in A.Y. 2013-14 and was deleted by the ld. CIT(A). I find that in A.Y. 2013-14, the assessee claimed labour expenses of Rs. 40,46,000/- and disallowed Rs. 10,68, 454/- for want of justification. I find that in A.Y. 2013-14, the Assessing Officer disallowed about 25% by treating as bogus. The ld. CIT(A) allowed relief to the assessee by holding that looking to the factual matrix of the case involved, I am reasonably of the view that such addition was not at all warranted and therefore the same is directed to be deleted. 20. I find that the reasoning given by the ld. CIT(A) lacks the sound reasoning. Once the addition was made for want of evidence, cannot be allowed without holding that there is sufficient evidence to substantiate such claim. Now adverting to the facts for the year under consideration, as noted ..... X X X X Extracts X X X X X X X X Extracts X X X X
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