M/S. Royal Mittal, Kolkata v. ITO, Ward-36(1), Kolkata, Kolkata

ITA 19/KOL/2015 | 2010-2011
Pronouncement Date: 21-10-2016

Appeal Details

RSA Number 1923514 RSA 2015
Assessee PAN AAAAR6857P
Bench Kolkata
Appeal Number ITA 19/KOL/2015
Duration Of Justice 1 year(s) 9 month(s) 14 day(s)
Appellant M/S. Royal Mittal, Kolkata
Respondent ITO, Ward-36(1), Kolkata, Kolkata
Appeal Type Income Tax Appeal
Pronouncement Date 21-10-2016
Appeal Filed By Assessee
Bench Allotted SMC
Tribunal Order Date 21-10-2016
Date Of Final Hearing 10-08-2016
Next Hearing Date 10-08-2016
Assessment Year 2010-2011
Appeal Filed On 07-01-2015
Judgment Text
I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 1 OF 8 IN THE INCOME TAX APPELLATE TRIBUNAL KOLKATA A(SMC) BENCH KOLKATA BEFORE SHRI P.M. JAGTAP ACCOUNTANT MEMBER I.T.A. NO. 19/KOL/ 2015 ASSESSMENT YEAR: 2010-2011 M/S. ROYAL MITTAL ................................. .............................APPELLANT 18 R.N. MUKHERJEE ROAD 6 TH FLOOR KOLKATA-700 001 [PAN: AAAAR 6857 P] -VS.- INCOME TAX OFFICER ................................ ...........................RESPONDENT WARD-36(1) KOLKATA AAYAKAR BHAWAN POORVA 110 SHANTI PALLI E.M. BY-PASS KOLKATA-700 107 APPEARANCES BY: SHRI S.M. SURANA ADVOCATE FOR THE ASSESSEE SHRI A.K. SINGH JCIT D.R. FOR THE DEPARTMENT DATE OF CONCLUDING THE HEARING : AUGUST 10 2016 DATE OF PRONOUNCING THE ORDER : OCTOBER 21 2016 O R D E R THIS APPEAL FILED BY THE ASSESSEE IS DIRECTED AGAIN ST THE ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-XX KOLKAT A DATED 25.07.2014 AND THE SOLITARY ISSUE ARISING OUT OF THE SAME RELA TES TO THE ADDITION OF RS.16 59 316/- MADE BY THE ASSESSING OFFICER AND CO NFIRMED BY THE LD. CIT(APPEALS) ON ACCOUNT OF DISALLOWANCE OF EXPENSES CLAIMED BY THE ASSESSEE ON SALARY. 2. THE ASSESSEE IN THE PRESENT CASE IS AN A.O.P. W HICH IS ENGAGED IN THE BUSINESS AS A RAILWAY CONTRACTOR. THE RETURN OF INCOME FOR THE YEAR UNDER CONSIDERATION WAS FILED BY IT ON 19.08.2010 D ECLARING TOTAL INCOME I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 2 OF 8 OF RS.4 74 190/-. IN THE PROFIT & LOSS ACCOUNT FILE D ALONG WITH THE SAID RETURN A SUM OF RS.16 59 316/- WAS DEBITED BY THE ASSESSEE ON ACCOUNT OF SALARY EXPENSES. DURING THE COURSE OF ASSESSMENT PR OCEEDINGS THE FOLLOWING SUBMISSIONS WERE MADE BY THE ASSESSEE IN SUPPORT OF ITS CLAIM FOR SALARY EXPENSES:- IN RESPECT OF EMPLOYEES EMPLOYED BY US WE ARE ENCLOSING THE SALARY SHEET OF PAYMENTS MONTH WISE THE STATUTORY DEDUCTION WERE NOT APPLICABLE AS PER THE SALARY SCALE GIVEN BY US FURTHER THERE IS NO APPLIC ABILITY OF PROFESSIONAL TAX IN JHARKHAND. REGARDING APPOINT MENT LETTERS BIO DATA ETC SINCE THE PROJECT IS COMPLETE THE RELEVANT FILE RECORDS AND OTHER DOCUMENTS WERE SHIF TED FROM THE SITE OFFICE TO A TEMPORARY PLACE AND THERE FORE NOT READILY AVAILABLE WE WILL PROVIDE THE SAME IN DUE COURSE. WE ARE ALSO ENCLOSING THE DETAILS OF EMPLOY EES WHO HAVE CONTINUED IN OUR JV IN THE FINANCIAL YEAR 2010- 11.' IN RESPECT OF YOUR QUERY REGARDING EMPLOYMENT OF 17 ODD NOS. OF PERSONS WE HAVE EMPLOYED 15 SUPERVISORS BEC AUSE ONE OUT OF SEVENTEEN IS ACCOUNTANT AND OTHER A COMP UTER OPERATOR. THE EMPLOYMENT OF SUPERVISOR OR OTHER STA FF ARE NECESSARY IN VIEWS OF THE CLAUSE NO. 13 OF AGRE EMENT BETWEEN ROYAL MITTAL JV AND M/S ROYAL INFRA CONSTRU WHEREIN IT IS STIPULATED THAT IN CASE PROGRESS OF T HE WORK OR QUALITY THEREOF IS NOT UPTO THE MARK THEN ROYAL MITTAL JV WILL HAVE RIGHT TO TAKE OVER THE WORK IN AS A WH ERE IS CONDITION WITHIN TEN DAYS OF NOTICE'. WITH SUCH STIPULATION IN THE CONTRACT WHERE TIME IS ESSENCE O F THE PROJECT IF IT IS NOT SUPERVISED PROPERLY AND IN CAS E THE PROJECT GOT DELAYED THEN WE AS A CONTRACTOR WOULD S UFFER LOSSES DUE TO CANCELLATION OF CONTRACTOR SEVERE PEC UNIARY PENALTIES WHICH WILL AFFECT NOT ONLY THIS PROJECT BUT ALL THE FUTURE PROSPECTS WITH RAILWAYS. THE ABOVE SUBMISSION MADE BY THE ASSESSEE WAS NOT F OUND ACCEPTABLE BY THE ASSESSING OFFICER AND REJECTING THE SAME HE PR OCEEDED TO DISALLOW THE SALARY EXPENSES CLAIMED BY THE ASSESSEE MAINLY FOR THE FOLLOWING REASONS GIVEN IN THE ASSESSMENT ORDER:- 1. THE ASSESSEE HAS DISCUSSED ONLY NON-APPLICABILI TY OF PROFESSIONAL TAX IN JHARKHAND. BUT IT HAS ESCAPED T O EX LAIN THE REASON(S) FOR NON-DEDUCTION OF EMPLOYEES' AND I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 3 OF 8 EMPLOYER'S CONTRIBUTION TOWARDS PROVIDENT FUND ESI ETC. IN RESPECT OF THE SALARY PAID TO THE ABOVE SAI D PERSONS TO WHOM THE ASSESSEE HAS CLAIMED TO HAVE ENGAGED AS EMPLOYEE DURING THE F.Y. 2009-10. THUS I T IS APPARENT THAT THE ASSESSEE HAD NOT ENGAGED ANY EMPLOYEE FOR SUPERVISION/ACCOUNTING/COMPUTER WORKS DURING THE F.Y. 2009-10 AND THUS QUESTION OF ANY DEDUCTION TOWARDS PROVIDENT FUND AND ESI DOES NOT ARISE. 2. ON PERUSAL OF THE MONTHLY SALARY SHEETS PROVIDED BY THE ASSESSEE IT IS SEEN THAT THE SALARY SHEETS DO N OT PROVIDE ANY INFORMATION AS TO WHEN THE SALARY WAS DISBURSED AND WHEN THE EMPLOYEES ENROLLED THEREIN RECEIVED THEIR SALARY. THE SALARY WERE SHOWN PAID WITHOUT USING 'REVENUE STAMP OF RS.1/- WHICH IS NECESSARY TO BE USED WHILE MAKING PAYMENT EXCEEDING RS.5 000/-. THE FACE OF THE SALARY SHEETS ITSELF RE VEAL THAT THEY WERE MANUFACTURED ONLY FOR SUBMITTING THE M IN THIS OFFICE. 3. THE ASSESSSEE'S CLAIM THAT THEIR APPOINTMENT LET TERS BIO DATA ETC ARE NOT READILY AVAILABLE SINCE THE PR OJECT IS COMPLETE AND THUS THE RELEVANT FILE RECORDS AND OTH ER DOCUMENTS WERE SHIFTED FROM THE SITE OFFICE TO A TEMPORARY PLACE IS APPARENTLY NOT CONVINCING AS TO WHY THE RELEVANT RECORDS HAD TO BE SHIFTED TO A TEMPORA RY PLACE AND NOT TO THE HEAD OFFICE OF THE ASSESSEE BE ING SITUATED AT KOLKATA. THUS SEEKING TIME FOR SUBMISSI ON OF THE REQUISITIONED DOCUMENTS IS NOTHING BUT BUYING T IME FOR MANUFACTURING THE SAME FOR SUBMISSION BEFORE TH E UNDERSIGNED. 4. THE ASSESSEE'S CLAIM THAT TO KEEP TAB ON PROGRES S AND QUALITY OF WORK THE EMPLOYMENT OF SUPERVISOR OR OTH ER STAFF WERE NECESSARY IN VIEWS OF THE CLAUSE NO. 13 OF AGREEMENT BETWEEN ROYAL MITTAL JV AND M/S ROYAL INFRACONSTRU LTD DOES ALSO NOT CARRY MUCH WEIGHT IN VIEW OF THE FACT THAT M/S ROYAL INFRACONSTRU LIMITE D IS NOT ONLY SUB-CONTRACTOR OF THE PROJECT BUT ALSO A M AIN MEMBER (PARTNER) OF THE ASSESSEE AOP HAVING 85% SHA RE OF PROFIT AND THUS AN IDEA OF ENGAGING ANY EMPLOYEE ONLY FOR KEEPING AN EYE ON EFFECTIVENESS AND COMPETENT O F ITS OWN MAIN PARTNER HAVING 85% SHARE IN ITS PROFIT IS NOT CONVINCING AT ALL. 5. THE ASSESSE FAILED TO SUBMIT ANY EVIDENCE REGARD ING IDENTITY OF THE EMPLOYEES THEIR EDUCATION AND THE I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 4 OF 8 EVIDENCE REGARDING THE WORKS THEY CARRIED OUT FOR T HE ASSESSE 'AOP' DURING THE FINANCIAL YEAR 2009-10. 6. THE ASSESSEE COULD NOT PRODUCE/SUBMIT ANY EVIDEN CE WHICH COULD PROVE CLEARLY THAT IT HAD ENGAGED PERSO NS AS SUPERVISOR/COMPUTER STAFF AND ACCOUNTANT AND RECEI VED DUE SERVICES FROM THEM. PAYMENTS TO THEM WERE ALSO CLAIMED TO HAVE BEEN MADE IN CASH ONLY. 3. THE DISALLOWANCE MADE BY THE ASSESSING OFFICER O N ACCOUNT OF SALARY WAS DISPUTED BY THE ASSESSEE IN APPEAL FILED BEFORE THE LD. CIT(APPEALS) AND DURING THE COURSE OF APPELLATE PRO CEEDINGS BEFORE HIM THE FOLLOWING SUBMISSIONS WERE MADE BY THE ASSESSEE IN SUPPORT OF ITS CLAIM FOR DEDUCTION ON ACCOUNT OF SALARY EXPENSES:- 'THE APPEAL IS DIRECTED AGAINST THE ORDER OF THE AO PASSED U/S. 143(3) OF THE I.T. ACT 1961. THE ONLY GROUND OF APPEAL IS THE DISALLOWANCE OF THE ENTIRE SALARY OF RS. 16 59 316/- PAID DURING THE YEAR TO THE EMPLOYEES. THE FACTS OF THE CASE ARE THAT THE ASSESSEE AS AOP WAS CONSTITUTED BY TWO ENTITIES VIZ. ROYAL INFRA CO NSTRO LIMITED AND MITTAL BROS. ENGS AND CONTRACTORS. THIS AOP ENTERED INTO A CONTRACT WITH RAILWAYS TO CARRY OUT CERTAIN PROJECTS AT DIFFERENT SITES. THE CONTRACT W AS UNDERTAKEN TOWARDS THE END OF THE A.YR. 2009-10 WHE N PERTAINING TO F.Y. 2008-09. IN THAT YEAR ONLY PILIN G WORK WAS UNDERTAKEN THE BILLS FOR ADVANCES WERE MADE ON THE RAILWAYS AND THE ASSESSEE RECEIVED CERTAIN PAYMENT WHICH WERE ACCOUNTED FOR AS INCOME. SINCE HOWEVER N O WORK ON SURFACE LEVEL WAS EXECUTED NO SUPERVISION W AS REQUIRED AND FURTHER THERE WAS PRACTICALLY NO WITHDRAWAL FROM THE BANK NOR ANY CORRESPONDENCE NO EMPLOYEE WAS KEPT. THE CONTRACT WAS ENTERED INTO ON 2.12.2008 AND THE ACTUAL WORK WAS STARTED IN JAN. 2 009. THEREFORE NEITHER ANY SALARY WAS PAID NOR ANY CLAI M FOR SALARY WAS MADE IN THE ACCOUNTS IN ASSESSMENT YEAR 2009-10. THIS SHOWS THE GENUINITY OF THE ASSESSEE J V THAT SALARY WAS CLAIMED ONLY IN THE YEAR WHEN EMPLOYEES WERE KEPT AND SALARY WAS PAID. HOWEVER FULL SWING WORK STARTED DURING THE ASSESSMENT YEAR IN QUESTION ON THE SURFACE AND IT W AS FELT THAT THE SUPERVISORY STAFF BOTH FOR CONTRACT W ORK AS WELL AS FOR ACCOUNTING WORK AND FOR COMPUTER OPERAT IONS HAVE TO BE KEPT SO THAT THE WORK IS EXECUTED AS PER I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 5 OF 8 CONTRACT. THE ASSESSEE EMPLOYED SOME SUPERVISORY ST AFF ACCOUNTANT AND COMPUTER SUPERVISOR AND THE TOTAL CL AIM OF THE SALARY WAS RS.16 59 316/-. THE ASSESSEE FILE D THE DETAILS OF THE PERSONS TO WHOM SALARY WAS PAID BUT ON BEING ASKED BY THE ITO TO PRODUCE THE EMPLOYEES IT WAS INFORMED THAT THE ASSESSEE JOINT VENTURE DULY EXECU TED THE CONTRACT IN SEPT. 2011 THERE WAS NO OTHER FRES H CONTRACT WAS TAKEN THE JV WAS DISSOLVED AND THEREFO RE THE EMPLOYEES WERE TERMINATED. HOWEVER THE NAMES A ND ADDRESSES OF THE EMPLOYEES AS REQUIRED BY THE AO WE RE FILED. THE AO STILL DOUBTED THE PAYMENT OF SALARY A ND ISSUED SUMMON U/S. 133(6) TO THE EMPLOYEES TO THE ADDRESSES GIVEN. IT APPEARS FROM THE ASSESSMENT ORD ER THAT SUMMONS WERE DULY SERVED ON 8 EMPLOYEES OUT OF 17 PERSONS EMPLOYEE/EMPLOYEES AND IN FACT 3 OF THEM AL SO CONFIRMED HAVING RECEIVED THE SALARY. STILL THE AO FOR ONE REASON OR THE OTHER HAS DISALLOWED THE SAID SALARY/REMUNERATION TO THE EMPLOYEES. IT IS SUBMITTED THAT THE ASSESSEE DULY PRODUCED THE SALARY REGISTER BEFORE THE AO AS WELL AS THE CASH B OOK SHOWING THE DATE OF PAYMENT OF SALARY TO THE EMPLOY EES. THE BANK STATEMENT OF THE ASSESSEE WAS ALSO PRODUCE D TO SHOW THE CASH WITHDRAWALS. BEFORE THE AO IT WAS ALS O SHOWN THAT THE ASSESSEE HAD TO MAKE CORRESPONDENCES SUBMIT BILLS TO THE CONTRACTEE COLLECT CHEQUES AND PUT THE SAME INTO BANK AND MAKE DISBURSEMENT AS MAY BE REQUIRED FOR BUSINESS PURPOSES. THE TWO JOINT VENTU RE PARTNERS WERE NOT HUMAN BEINGS TO LOOK AFTER THE JO INT VENTURE BUSINESS AND THEREFORE THE SERVICES OF EMPL OYEES WAS A NECESSITY. IF IT IS PRESUMED THAT NO EMPLOYEE S WERE KEPT THEN HOW THE BUSINESS COULD BE CONDUCTED BANK ACCOUNT CAN BE OPERATED SUPERVISION CAN BE DONE IS A BIG QUESTION? NOT ONLY THAT THE APPELLANT WAS MAINTAINING TWO COMPUTERS WHICH MEANS THE COMPUTER OPERATOR WAS THERE. THE APPELLANT WAS ALSO MAINTAIN ING CASH BOOK AND LEDGER WHICH COULD NOT HAVE BEEN MAINTAINED UNLESS THE EMPLOYEES WERE KEPT AND NOT O NLY THAT THE RETURNS OF INCOME AS WELL AS DIFFERENT STA TEMENT HAVE TO BE FILED BEFORE A NUMBER OF AUTHORITIES WHI CH WERE STATUTORILY REQUIRED TO CARRY ON THE BUSINESS. THEREFORE THE AO CANNOT SAY THAT THERE WAS NO EMPLO YEE AT ALL. MOREOVER THE TOTAL TURNOVER DURING THE YEAR WAS RS.5 42 96 090/- AND THEREFORE THE PAYMENT OF SALAR Y TO THE EXTENT OF RS.16 91 570/- ON ACCOUNT OF PAYMENT TO SUPERVISORY STAFF COMPUTER OPERATOR ACCOUNTANT(AL L DESIGNATED AS SUPERVISORS) AND THE PEON ALL BEING ADMINISTRATIVE STAFF WAS FULLY PROVED AND THE EXPEN SES INCURRED WERE REASONABLE CONSIDERING THE TURNOVER THE I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 6 OF 8 NATURE OF WORK AS WELL AS THE EXECUTION OF CONTRACT WORK. IT IS PERTINENT TO NOTE THAT SUMMONS WERE DULY SERV ED ON 50% OF THE PERSONS EVEN AFTER EXPIRY OF ABOUT 2 YEA RS WHICH SHOWS THAT THE EMPLOYEES WERE EXISTING AND FURTHER 3 OF THEM DULY CONFIRMED HAVING RECEIVED TH E SALARY. IN VIEW OF THE ABOVE THE DISALLOWANCE OF SALARY MADE BY THE AO WHICH WAS PROVED AND WAS QUITE FAIR AND REASONABLE MAY BE DELETED. IT MAY HERE BE STATED THAT THE AO HAS DULY ALLOWED THE EXPENSES UNDER THE HEAD TRAVELLING AND CONVEYAN CE THESE EXPENSES WERE INCURRED BY THE SAME VERY EMPLOYEES. HENCE THE DISALLOWANCE MADE BY THE AO M AY BE DELETED.' 4. THE ABOVE SUBMISSIONS MADE BY THE ASSESSEE WERE NOT FOUND ACCEPTABLE BY THE LD. CIT(A). ACCORDING TO HIM THE ENTIRE CONTRACT WORK TO BE UNDERTAKEN BY THE ASSESSEE WAS GIVEN TO SUB-C ONTRACTORS FOR EXECUTION AND THERE WAS THUS NO NEED FOR THE ASSESS EE TO INCUR ANY EXPENDITURE ON SALARY. HE ACCORDINGLY CONFIRMED THE DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF SALARY EXPEN SES. AGGRIEVED BY THE ORDER OF THE LD. CIT(APPEALS) THE ASSESSEE HAS PRE FERRED THIS APPEAL BEFORE THE TRIBUNAL. 5. THE LD. COUNSEL FOR THE ASSESSEE SUBMITTED THAT THE TOTAL WORKS CONTRACT TO BE UNDERTAKEN BY THE ASSESSEE WAS SUB-C ONTRACTED ON 85%:15% BASIS AND IN ORDER TO SUPERVISE THE EXECUTI ON OF THE SAID WORK BY THE SUB-CONTRACTORS THE ASSESSEE HAD ENGAGED OR EMPLOYED 15 SUPERVISORS DURING THE YEAR UNDER CONSIDERATION. HE SUBMITTED IN ADDITION TO THE SAID SUPERVISORY STAFF ONE ACCOUNT ANT AND ONE COMPUTER OPERATOR WERE ALSO EMPLOYED BY THE ASSESSEE FOR THE PURPOSE OF ITS BUSINESS. HE ALSO SUBMITTED THAT SOME OF THE EMPLOY EES IN RESPONSE TO THE NOTICES ISSUED BY THE ASSESSING OFFICER HAD ACC EPTED THE FACT OF THE EMPLOYMENT OF THE ASSESSEE AND EVEN THE ASSESSING O FFICER WHILE COMPLETING THE ASSESSMENT HAD ALLOWED THE EXPENDITU RE CLAIMED BY THE ASSESSEE ON ACCOUNT OF TRAVELLING AND CONVEYANCE OF ALL THE PERSONS I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 7 OF 8 EMPLOYED BY THE ASSESSEE. HE SUBMITTED THAT THERE W ERE EIGHT MAJOR CONTRACTS OF CONSTRUCTION OF BRIDGES EXECUTED BY TH E ASSESSEE IN THE YEAR UNDER CONSIDERATION AND KEEPING IN VIEW THE SAME T HE EXPENSES INCURRED BY THE ASSESSEE ON SALARY WAS FULLY ALLOWABLE BEING THE EXPENDITURE INCURRED WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF ITS BUSINESS. 6. THE LD. D.R. ON THE OTHER HAND STRONGLY RELIED ON THE ORDERS OF THE AUTHORITIES BELOW IN SUPPORT OF THE REVENUES CASE ON THIS ISSUE AND SUBMITTED THAT THE ADVERSE FINDINGS SPECIFICALLY RE CORDED BY THE ASSESSING OFFICER MAY BE TAKEN INTO CONSIDERATION W HILE DECIDING THE ISSUE INVOLVED IN THIS APPEAL OF THE ASSESSEE. 7. I HAVE CONSIDERED THE RIVAL SUBMISSIONS AND ALSO PERUSED THE RELEVANT MATERIAL AVAILABLE ON RECORD. IT IS OBSERV ED THAT MAJOR CONTRACTS OF EXECUTION OF CIVIL WORK INCLUDING CONSTRUCTION O F BRIDGES WERE RECEIVED AND UNDERTAKEN BY THE ASSESSEE DURING THE YEAR UNDE R CONSIDERATION. NO DOUBT THE SAID CONTRACTS WERE GOT EXECUTED BY THE ASSESSEE THROUGH SUB- CONTRACTORS ON 85% : 15% BASIS. HOWEVER KEEPING IN VIEW THAT THE SAID CONTRACTS WERE IN NAME OF THE ASSESSEE IT WAS THE RESPONSIBILITY OF THE ASSESSEE TO ENSURE THE QUALITY OF WORK AS WELL AS C OMPLETION OF WORK IN TIME. 15% OF THE TOTAL CONTRACT RECEIPTS WERE RECEI VED BY THE ASSESSEE FOR THIS PURPOSE AND IN ORDER TO ENSURE THE QUALITY OF WORK AS WELL AS THE TIMELY COMPLETION CERTAIN PERSONS WERE REQUIRED TO BE ENGAGED OR EMPLOYED BY THE ASSESSEE TO DO THE SUPERVISION OF T HE WORK ON ITS BEHALF. THE EXPENSES INCURRED ON PAYMENT OF SALARY TO SUCH PERSONS THUS WERE INCURRED BY THE ASSESSEE FOR THE PURPOSE OF ITS BUS INESS AND THE SAME IN MY OPINION CANNOT BE ENTIRELY DISALLOWED EVEN THOU GH THE ADVERSE FINDINGS RECORDED BY THE ASSESSING OFFICER IN THIS REGARD ARE SUFFICIENT TO SHOW THAT THE EXPENSES CLAIMED BY THE ASSESSEE ON S ALARY WERE NOT FULLY VERIFIABLE. HAVING REGARD TO ALL THESE FACTS AND CI RCUMSTANCES OF THIS CASE I AM OF THE VIEW THAT IT WOULD BE FAIR AND REASONAB LE TO DISALLOW 25% OF THE EXPENSES INCURRED BY THE ASSESSEE ON ACCOUNT OF SALARY FOR THE UNVERIFIABLE ELEMENT INVOLVED THEREIN. ACCORDINGLY I MODIFY THE I.T.A. NO. 19/KOL./2015 ASSESSMENT YEAR: 2010-2011 PAGE 8 OF 8 IMPUGNED ORDER OF THE LD. CIT(APPEALS) ON THIS ISSU E AND DIRECT THE ASSESSING OFFICER TO RESTRICT THE DISALLOWANCE MADE ON ACCOUNT OF SALARY TO 25%. 8. IN THE RESULT THE APPEAL OF THE ASSESSEE IS PAR TLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON OCTOBER 21 2 016. SD/- (P.M. JAGTAP) ACCOUNTANT MEMBER KOLKATA THE 21 ST DAY OF OCTOBER 2016 COPIES TO : (1) M/S. ROYAL MITTAL 18 R.N. MUKHERJEE ROAD 6 TH FLOOR KOLKATA-700 001 (2) INCOME TAX OFFICER WARD-36(1) KOLKATA AAYAKAR BHAWAN POORVA 110 SHANTI PALLI E.M. BY-PASS KOLKATA-700 107 (3) COMMISSIONER OF INCOME TAX(APPEALS)-XX KOLKAT A; (4) COMMISSIONER OF INCOME TAX- (5) THE DEPARTMENTAL REPRESENTATIVE (6) GUARD FILE BY ORDER ASSISTANT REGISTRAR INCOME TAX APPELLATE TRIBUNAL KOLKATA BENCHES KOLKATA LAHA/SR. P.S.