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Facts
The assessee filed an appeal challenging an order from the NFAC concerning AY 2018-19. The primary dispute revolved around the disallowance of labour charges incurred for constructing flats that were later sold.
Held
The Tribunal noted that the assessee had opted for the Direct Tax Vivad Se Vishwas Scheme, 2024. Given this, the Tribunal found no purpose in continuing the appeal proceedings.
Key Issues
Whether the appeal is infructuous due to the assessee availing the Vivad Se Vishwas Scheme, and whether disallowance of labour charges for construction was justified.
Sections Cited
37(1)
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Income Tax Appellate Tribunal, ‘B’ BENCH : BANGALORE
Before: SHRI WASEEM AHMED & SHRI SOUNDARARAJAN K.
ORDER PER SOUNDARARAJAN K., JUDICIAL MEMBER
This is an appeal filed by the assessee challenging the order of the NFAC, Delhi dated 15.10.2024 in respect of the A.Y. 2018-19 and raised the following grounds: “
1. The order of CIT-A is opposed to Law and Facts of the Case.
2. The CIT-A failed to appreciate that the appellant having constructed flats and sold the same during the year without incurring of labour charges is not correct.
3. The CIT-A failed to appreciate that the appellant having sold the flats during the year and offered the sale consideration of Rs.11,29,81,989/- construction of building the labour is a must and cannot be held as not necessary for business and disallowance U/s 37 is not correct.
4. The CIT-A is not correct in coming to the conclusion that payment made to each labourer is more than Rs.20,000/- when the payment is made to number of labourers on a weekly basis.
The CIT-A failed to appreciate that the appellant himself has paid the labour charges on a weekly basis as per the account copy enclosed. 6. The CIT-A failed to appreciate that labour charges being one of the main ingredient in construction cannot be held as not for the purpose of business and disallowance U/s 37(1) is not correct. 7. The CIT-A failed to appreciate that the proof of payment which is bulk could not be upload in the system. 8. The appellant craves, lead to add, alter, amend, substitute, change and delete any grounds of appeal
9. For the above and other grounds that may urged at the time of hearing, the appellant prays that the appeal may be allowed and Justice rendered.”
2. At the time of hearing, it was brought to our notice that the assessee had opted to avail the settlement scheme under the Direct Tax Vivad Se Vishwas Scheme, 2024 and also filed a copy of form 1 filed before the authority. The assessee also filed form 2 and form 3 to show that the amount quantified by the authority was also paid on 07/02/2025 and informed that the assessee is awaiting for the issuance of form 4.
In such circumstances, there is no purpose in keeping this matter pending for hearing since the assessee had already availed the settlement under the Direct Tax Vivad Se Vishwas Scheme, 2024. Recording the said submissions made by the Ld.AR, we dismiss this appeal as infructuous.
In the result, the appeal filed by the assessee is dismissed as infructuous.
Order pronounced in the open court on 30th April, 2025.