The Revenue in the present Appeal under Section 260A of the Income Tax Act, 1961 (hereinafter referred to as 'the Act') has challenged the order dated 22nd October 2011 of the Income Tax Appellate Tribunal, Ahmedabad Bench – A in ITA No.2527/Ahd/2007 wherein the following three questions are raised proposing them as substantial questions of law. “[A] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of diesel and Bhattha expenses and whether the said findings are not perverse?
[B] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of proportionate interest expenses and whether the said findings are not perverse?
[C] Whether the Appellate Tribunal is right in law and on facts in deleting the disallowance of bad debts and whether the said findings are not perverse?”
2.0 At the threshold of hearing, Mr. M. R. Bhatt, learned standing senior counsel assisted by Mrs.Mauna Bhatt, learned advocate appearing for the department, fairly conceded that as far as question Nos.[B] & [C] above are concerned they were covered by order dated 10th January 2012 of a Division Bench of this Court passed in Tax Appeal No.1943 of 2010. The said appeal had been dismissed. This Court is therefore not required to go into the said two questions.
3.0 The remaining question 'A' relates to disallowance of expenses for diesel and Bhattha. The assessee claimed combined expenses under the head 'Diesel expenses' and the 'Trip and Bhattha' expenses totaling to Rs.3,71,08,648/, as against Rs.2,14,40,219/ claimed in the preceding assessment year. When he was asked to explain the disproportionate increase in expenses in consumption of diesel etc., it was stated by the assessee that the increase was due to the factors like age of the truck, kilometers of travel by the truck and hike in diesel prices etc. Having not satisfied with the explanation, the Assessing Officer disallowed Rs.1,37,53,333/ and Rs.11,00,267/ towards diesel expenses applying cut of 8% in the total amount claimed for respective expenses.
4.0 The Commissioner (Appeals) restricted the disallowance of Rs.10 lacs as against Rs.29,68,000/ taking view that disallowance effected by the Assessing Officer at 8% on the total claim was on the higher side and taking into account the fact that input cost had gone up by 32% in the current year, the operational results for the current year would be different from the preceding year. Accordingly, the Appellate Commissioner restricted the disallowance to Rs.10 lacs and the balance of Rs.19.68 lacs was permitted to be deleted.
5.0 Upon appeal preferred by the Revenue before the Tribunal, the Tribunal found that the order of the CIT(Appeals) was proper. The Tribunal also noted that in the case of same assessee it had affirmed the order of CIT(Appeals) in respect of the preceding assessment year and subsequent years.
6.0 The findings recorded by the Tribunal are on the basis of material before it and on appreciation of factual aspects. They are findings of fact, which are reasonable and no perversity is demonstrated. In the circumstances, no substantial question of law arises in the present appeal.
7.0 Accordingly, this Tax Appeal is dismissed.
[V. M. SAHAI, J. ] Amit [N. V. ANJARIA, J.]