M/S. S. Rasiklal & Co v. Asstt. Commissioner Of Income Tax Circle 16(3), Mumbai )........ Respondant

IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 581 OF 2005 M/s. S. Rasiklal & Co. .......Appellant versus Asstt. Commissioner of Income tax Circle 16(3), Mumbai )........ Respondant. Mr. Nitesh Joshi i/b Mulla & Mulla for the Appellant CORAM: SWATANTER KUMAR, C.J., & A.P. DESHPANDE, J. DATED: 24TH SEPTEMBER, 2008. P.C.: 1.We have heard the learned counsel for the appellant.The challenge in the present appeal is to the order passed by theTribunal on 2-1-2004 by which the appeal filed by the Revenuewas partly allowed. The matter primarilly related to the claim ofhigher labour charges. The case in fact was on the basis ofsurvey conducted under section 132A of the act on 22-12-1997on the business of the assessee. On enquiries made, genuinessand reasonableness of labour charges paid by the assessee to theparties to whom the assessee has claimed to have paid the labourcharges, do not have any documentary evidence. 2.The Tribunal by its order dated 2-1-2004 held as under: “ We find that the A.O. allowed specific opportunityto cross examine the parties, who had earlier confirmed thatthey have not done any work for the assessee, but theassessee failed to cross examine the parties. The A.O. In theoriginal assessment order u/s. 143(3) has recorded aboutthese facts and also that the assessee has not filed anyexplanation in this connection till the date of passing of theoriginal assessement order. We find that if the assessee wasfacing any difficulty in producing these parties for their crossexamination, it would have made a request to the A.O. Tosummon these parties for cross examination etc. the assesseeadmittedly failed to do. In these facts, we hold that it cannotbe said that the assessee has proved the genuineness of thelabour charges claimed by it. Merely because the higherlabour charges in the subsequent assessment years wereallowed by the revenue is not decisive of the issue. We findthat in the immediately preceding A.Y. 85-86 the labourcharges comes to Rs. 154.79p. Per carat. Considering thetotality of the facts and circumstances of the case, we holdthat in view of the fact that the assessee could not prove thegenuiness of the increase in the labour charges claimed by itand considering the instances of other traders in the line oftrade with regard to labour charges, it shall be reasonable tosustain a disallowance of Rs. 5,00,000/- out of labour chargesclaimed by the assessee and accordingly, the ground of appealof the revenue is partly allowed.” 3.The above findings have been questioned by theappellant as being adverse finding and are not reasonable on theground of requisite question of law, which is sought to be raisedin the present appeal for consideration of this court. We areunable to find any merit in the contention that the findings 3.The above findings have been questioned by theappellant as being adverse finding and are not reasonable on theground of requisite question of law, which is sought to be raisedin the present appeal for consideration of this court. We areunable to find any merit in the contention that the findings recorded by the Tribunal are totally contrary because these arethe findings which no reasonable human personal can arrive at.We noticed that the assessee had written a letter on 29[th] March,during pendency of the proceeding before the assessement officerstating that labour charges have been paid and that those agentshad given negative statement and wishes to place documents onrecord. This explanation was not accepted by the assessmentofficer while passing the order of assessment which noticed thatthe explanation now sought to be offered by the representative ofassessee, cannot concern with this very party who appeared andmade statement denying that they had done any work of labourand made any payment. Those parties also stated that they hadnot proved any documents and subsequent attempt on the part ofthe assessee to produce documents on record, was rejected. Weare unable to find any fault giving rise to any question of law inthis appeal. We further noticed that while referring to the workdone by other parties, it was also noticed by the tribunal thatnotices were returned as addresses given by the assessee were notcorrect. The learned counsel for the appellant relied upon ajudgment of the Supreme Court in case of Kishinchand ChellaramVs. Commissioner of Income tax reported in 1980 (125) ITR page713 to contend that this raises a question of law. The facts of thatcase are entirely different. It was not in dispute that in that casethe letter written by the manager of the bank which was relied upon by the department was neither shown nor kept thereon bythe assessee in that case wherein the assessee participated in theproceeding and was fully aware of the statement made by thealleged person whom he placed the labour work and whichrelied on transaction of providing work or even receivingpayment. Thus this judgment is of no help.3.No question of law involved. Appeal dismissed. CHIEF JUSTICE A.P. DESHPANDE, J.