M.M.KUMAR, J. - (1.) THIS order shall dispose of two appeals being ITA Nos. 175 and 176 of 2007.
(2.) PASSED by the Income -tax Appellate Tribunal Chandigarh (for brevity 'the Tribunal') in ITA No. 398/Chd/2004 in respect of the asst. yr. 2000 -01. It has been claimed that the following substantial questions of law would arise for the determination of this Court : "(i) Whether in the facts and circumstances of the case the orders Annex. P.1, Annex. P.2, and Annex. P.3 are legally sustainable ; (ii) Whether on the facts and in the circumstances of the case, the learned Tribunal is right in law in sustaining an addition of Rs. 15,00,000 out of the labour charges and Rs. 3,98,670 out of the labour charges payable the closing of the books of accounts and paid subsequently, in the financial year relevant to the asst. yr. 2001 -02 ; and (iii) Whether in the facts and in the circumstances of the case, the order of the Tribunal Chandigarh Bench, Chandigarh, Annex. P.1, sustaining the addition of Rs. 15,00,000 and Rs. 3,98,670 is legally sustainable; the same being based on mere presumptions and surmises -
(3.) BRIEF facts of the case are that the assessee firm is deriving its income from transportation contracts. In the year 1999 -2000 a year prior to the relevant asst. yr. 2000 -01 it disclosed transportation receipts of Rs. 1,88,54,650, but declared net profit of Rs. 78,160 only after debiting expenses on account of transportation, labour, interest, etc. It was noticed by the AO that the assessee had claimed expenditure of Rs. 37,79,920 as labour expenses in respect of loading and unloading of wheat bags. It was further noticed that a sum of Rs. 2,44,555 had been shown as outstanding loading charges @ Rs. 2.50 per bag. The assessee was asked to substantiate the claim of Rs. 3,79,920. It was found by the AO that the assessee had not maintained complete records and even the particulars of the drivers to whom the payments were made had not been maintained. The assessee failed to produce any of the persons to whom payments were either claimed to have been made or were shown outstanding. On enquiry from HAFED by the AO it was found that HAFED had paid to other contractors loading and unloading charges @ 56.2 paisa and 86.5 paisa per bag for loading and unloading of wheat bags of 50 kg. weight. The AO further found that the assessee is claimed to have paid the labourers at the rates more than the market rates. A show -cause notice was issued to the assessee to which no reply was furnished. The AO, accordingly recorded a finding that the assessee had inflated the labour expenses and disallowance of Rs. 20,00,000 was made by the AO. On appeal filed by the assessee the CIT(A) reduced the addition by a sum of Rs. 1,22,520 and sustained the addition of Rs. 18,77,480. On a further appeal the Tribunal reduced the addition by an amount of Rs. 1,32,925 sustained by the CIT(A) but sustained an addition of Rs. 15,00,000 out of the labour charges debited by the appellant to the P&L a/c amounting to Rs. 37,79,920. After hearing the learned counsel for the assessee we find that the question of expenditure on labour charges is a pure question of fact. In an appeal filed under s. 260A of the Act, this Court cannot reappreciate the evidence to record a conclusion contrary to the one recorded by the Tribunal. There is no standard method or chart available which may constitute the basis for us to say that norm has been violated and according to principles of law the addition sustained by the Tribunal suffers from an error of law or jurisdiction. There is thus no substantial question of law which would arise for determination of this Court. Therefore, the appeals are wholly devoid of merit and the same are accordingly dismissed.;