9911796707
TMI Blog1985 (6) TMI 21X X X X Extracts X X X X X X X X Extracts X X X X ..... mpany. On being asked to explain the nature of duties performed by the lady and her qualifications which would enable her to perform the duties, the assessee by its letter dated February 11, 1969, to the Income-tax Officer submitted that Smt. Kamala Devi Saboo was working in the field of labour welfare and labour relations and her duties included welfare and social work among the workmen and their families. The Income-tax Officer, however, observed that the assessee did not come forward with any evidence regarding the duties alleged to have been performed by the lady who had been in the employment of the assessee for the last six or seven years. The Income-tax Officer also did not find any evidentiary value in the letter dated February 20, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... scussions made in the assessment order for the assessment year 1967-68 and observing that the lady was also in the employment of M/s. Birla jute Mfg. Co. Ltd., a sister concern, disallowance of salaries paid to the aforesaid lady were made. Being dissatisfied, the assessee company preferred appeals to the Appellate Assistant Commissioner for all the assessment years. It was contended before him that the Income-tax Officer was not justified in disallowing salaries paid to Smt. Kamala Devi Saboo and that, in any case, he should not have disallowed the whole amount. A reference was made to the letter written by Sri Jagannath Rao and the assessee's representative placed reliance on the Appellate Assistant Commissioner's orders in the cases o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oo for the assessment years 1961-62 to 1968-69 and preferred appeals before the Appellate Tribunal. Before the Tribunal, an additional ground was taken as regards the validity of the initiation of the proceedings under section 147 for the assessment years 1961-62 to 1966-67. The Tribunal admitted the additional ground and remanded the same to the Appellate Assistant Commissioner for his decision after taking into account the facts as already available on record. The Tribunal thereafter proceeded to decide the appeal on merits. After considering the facts and circumstances of the case, the Tribunal did not find any merit in the contention raised by the assessee. The Tribunal, thereafter, dismissed the appeals subject to the admission of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 2. Whether, on the facts and in the circumstances of the case, the finding of the Tribunal that Smt. Kamala Devi Saboo did not render adequate services commensurate to her salaries and, therefore, the salary paid to her was not laid out and expended wholly and exclusively for the purpose of the assessee's business was perverse and in excess of and beyond the scope of enquiry under sections 28 and 37 of the Income-tax Act, 1961?" It is true that the Tribunal admitted the additional ground as regards the validity of the proceedings under section 147 of the Act and remanded the matter to the Appellate Assistant Commissioner restricting his investigation into the facts as already available from the records. But that did not take away the jur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d to depend upon external evidence and the learned counsel for the assessee contended that the income-tax authorities should have made necessary enquiries before discarding the external evidence so produced in support of the lady's services rendered to the assessee company. Thus, in our opinion, the assessee had no case over and above the relief given by the Appellate Assistant Commissioner in his consolidated order." Having regard to the aforesaid findings of the Tribunal, we are of the view that the Tribunal was justified in sustaining the disallowances made by the Appellate Assistant Commissioner. In the premises, we answer the first and second questions for the assessment years 1961-62 and 1963-64 to 1968-69 in the affirmative and ..... X X X X Extracts X X X X X X X X Extracts X X X X
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