1 IN THE HIGH COURT OF JUDICATURE AT BOMBAY ORDINARY ORIGINAL CIVIL JURISDICTION INCOME TAX APPEAL NO. 336 OF 2006 Kamat & Co. ...Appellant Versus The Assistant Commissioner of Income-tax, Range-12(1), Mumbai, & Anr. ...Respondents Mr. Deepak Tralshawala with Mr. V.S. Hadade for the Appellant Mr. Vinod Gupta for the Respondents. CORAM: B ILAL NAZKI and S.S. SHINDE, JJ. DATE: JUNE 27, 2008 P.C.:- Heard the learned counsel for the parties. 2. Following questions have been framed:- “(a) On the facts and in the circumstances of the case, whether the Income-tax Appellate Tribunal was justified in law in estimating the disallowance at 25% of the claim as against the CIT(A)'s estimate of 10%? (b) On the facts and in the circumstances of the case, whether the Income-tax Appellate Tribunal was justified in law in estimating the disallowance at 25% of the claim as against the CIT(A)'s estimate of 10% by brushing aside the reasons recorded by the CIT(A)? 2 (c) On the facts and in the circumstances of the case and in law, whether there was any material before the Tribunal to disagree with the CIT(A) and estimate the disallowance at 25% of the claim? (d) On the facts and in the circumstances of the case, whether the Tribunal misdirected itself in law in basing its conclusion on some evidence ignoring other essential materials on record? 3. All questions relate to the facts whether disallowance at 25% of the claim was justified or disallowance at 10% was justified. Basically, this is a question of fact. The Tribunal, in paragraph 7 of its order, has discussed it in detail. The assessee had claimed expenditure of Rs.29,17,430/-, but it had not kept or placed before the authorities any evidence that it had actually incurred this expenditure. Although it stated that it had paid coollies and labour through supervisor or Mukadam, to whom the payment was made, but even it did not produce any receipts from either a supervisor or a Mukadam. Therefore, the Tribunal was justified in not allowing deduction at the rate of 50%. 4. The learned counsel for the appellant, however, has submitted that in earlier years and in subsequent years to the 3 assessment in question, the appellant was allowed deduction fully. Therefore, the order needs to be re-considered. We feel that the restriction to a certain percentage in disallowance would depend on the evidence produced, and the expenditure actually incurred in different years of assessment could be different. Therefore, if a disallowance is allowed at a particular rate in a particular year, that cannot be taken as precedent for other years. 5. The learned counsel for the appellant has relied on a judgment of the Madras High Court in Commissioner of Income-tax v. South India Corporation (Agencies) Ltd., reported in [2007] 293 ITR 237, where the assessee claimed disallowance of 50%. The High Court considered an earlier case, and found that the assessee had a lot of dishonest transactions with its subsidiary, and was carrying on various activities through the subsidiary, and, therefore, it was not possible to have the evidence to prove the actual expenditure. This case can be distinguished on the ground that the appellant itself claimed that it paid the money through supervisor, but did not produce any proof therefor. Therefore, the questions raised are purely factual, and cannot be gone into. 6. The appeal is dismissed. BILAL NAZKI, J. 4 S.S. SHINDE, J.