Commissioner Of Income Tax, Faridabad v. M/S Ram Gopal & Sons

In the High Court of Punjab and Haryana, at Chandigarh Income Tax Appeal No. 215 of 2014 Date of Decision: 29.7.2015 Commissioner of Income Tax, Faridabad ... Appellant(s) Versus M/s Ram Gopal & Sons ... Respondent(s) CORAM: HON'BLE MR. JUSTICE S.J. VAZIFDAR, ACTING CHIEF JUSTICE. HON’BLE MR. JUSTICE G.S. SANDHAWALIA. Present: Mr. Tajender K. Joshi, Advocate for the appellant(s). Mr. Jagmohan Bansal, Advocatefor the respondent(s). S.J. VAZIFDAR, A.C.J. (Oral) 1.This is an appeal against the order of Income Tax AppellateTribunal upholding the order of the Commissioner of Income Tax(Appeals) deleting the addition of `6,72,048/- made by the AssessingOfficer on account of labour charges and deleting the addition of `4,25,602/- made on account of shortage in production in respect of theassessment year 2005-06. 2.The appellant contends that the following substantialquestions of law arise:- “I.Whether on the facts and in the circumstances ofthe case, the ITAT was right in law in deleting theaddition of ` 6,72,048/- made by the AssessingOfficer on account of labour charges simply relyingon the decision in assessee's own case in the Asstt.Year 2005-06, without appreciating the facts broughton record by the Assessing Officer. II. Whether on the facts and in the circumstances ofthe case, the ITAT was right in law in deleting theaddition of ` 4,25,602/- made on account of shortage in production even when the assessee hasnot been able to justify the shortage in furnishedproduct.” 3.Question (II) has been answered against the appellant by ourorder and judgment passed today in Income Tax Appeal No. 214 of2014. This question is, accordingly, answered against the appellant. The first question also does not arise as a substantial questionof law. The assessee claimed deduction in respect of labour chargespaid to about 50 labourers. The Assessing Officer reduced this amounthaving come to the conclusion that only a few labourers were traceableat the given addresses and some of the addresses were not evenconfirmed. The Tribunal kept in mind the ground realities in such cases.There were comparable results in expenses of labour charges in earlieryears. The deductions were allowed to the assessee. The quantum ofexpenditure can be compared to the production done by the labour. Thelabour was engaged on piece rate bases. It was found that there was aco-relation between the production as well as the number of labourengaged. The issue really is a question of fact and appreciation of facts.We are unable to say that this analysis and the findings of the CIT(A)and of the Tribunal are perverse or absurd. In the circumstances, the appeal is dismissed. (S.J.Vazifdar)Acting Chief Justice July 29, 2015“DK” (G.S.Sandhawalia)Judge