THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR
I.T.T.A. No. 430 of 2014
DATED:17.07.2014 Between:
The Commissioner of Income Tax-II, Hyderabad.
And M/s. Hycons Infrastructure (India) Ltd., Hyderabad.
… Appellant ….Respondent THE HON’BLE THE CHIEF JUSTICE SRI KALYAN JYOTI SENGUPTA AND THE HON’BLE SRI JUSTICE SANJAY KUMAR
I.T.T.A. No. 430 of 2014
Judgment: (per the Hon’ble the Chief Justice Sri Kalyan Jyoti Sengupta)
This appeal is sought to be preferred against the judgment and order of the learned Tribunal dated 23.10.2013 in relation to the assessment year 2007-2008 on the following suggested question of law:
1. In the facts and circumstances of the case, whether the Hon’ble Income Tax Appellate Tribunal is correct in law in holding that once the income of the Respondent-assessee was estimated by rejecting the books of account, the Assessing Officer cannot make any disallowance under Section 40(a)(ia) of the Income Tax Act, 1961 when the labour payments as claimed by the Respondent-assessee are liable to be disallowed and to be added in terms of Section 40(a) (ia) of the Income Tax Act, 1961 ?
It appears from the records that there has been no production of books of accounts. Naturally, all the authorities below estimated profit at 8%.
Mr.B. Narasimha Sarma, learned counsel for the appellant submits that even then, the provisions of Section 40(a)(ia) of the Income Tax Act, 1961 (for short ‘the Act’) will have to be considered as it was amended subsequently.
We are of the view that amendment or no amendment, if the profit is estimated on any ground, whether ignoring books of accounts or rejection thereof, then there is no scope for allowability/disallowability of any deduction. In our considered view, the above provision mentions how to consider the same when the books of accounts are available and the same shall be accepted on fact by the authorities below.
In the circumstances, the appeal is dismissed.
Consequently, the miscellaneous applications, if any pending, shall also stand closed. No costs.
K.J. SENGUPTA, CJ 17th July, 2014 pnb SANJAY KUMAR, J