COMMISSIONER OF INCOME TAX Vs. DABWALI TRANSPORT COMPANY

JUDGEMENT

(1.) THIS appeal has been preferred by the revenue under Section 260 -A of the Income Tax Act, 1961 (for short, "the Act") against the order of the Income Tax Appellate Tribunal, Chandigarh dated 24.8.2009 in I.T.A. No. 596/Chd/2009 for the assessment year 2000 -01 proposing following substantial questions of law:

(2.) THE Assessing Officer, during the course of assessment, disallowed the labour expenses claimed by the Assessee in respect of loading and unloading of wheat bags for Haryana Warehousing Corporation, FCI and other departments. It was observed that the Assessee failed to produce evidence in support of the claim for the expenses and to rebut the information collected by the Assessing Officer that the charges paid were at a lesser rate. On appeal, the CIT (A) reduced the addition and on further appeal, disallowance of expenses was further reduced. The Assessing Officer also initiated penalty proceedings and finally, levied penalty, which was upheld by the CIT(A). On further appeal, the Tribunal set aside the penalty. It was held that there was no material to show that the Assessee consciously concealed the income or furnished inaccurate particulars. Mere disallowance of expenses for want of evidence could not automatically entail penalty. The finding recorded by the Tribunal is as under:

(3.) CONTENTION raised on behalf of the Appellant is that addition on account of disallowance of expenses having been upheld by this Court, burden of proof was on the Assessee to show that expenses were claimed on valid basis, in absence of which, it could be presumed that the Assessee had consciously furnished incorrect particulars to conceal income by deliberately claiming excessive expenses.