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Tax Reference No. 332 of 1972, decided on 19th June, 1979.

‑‑‑‑Ss. 66 & 66‑A‑Reference‑‑Question of law‑Assessee not maintaining stock register on regular basis‑Books of accounts also defective‑ Controversy about disallowance in repairs made by Income‑tax Officer, held, substantially in domain of facts and poses no question of law.

Irshad Hassan Khan for Petitioner.

Sh. Abdul Haq for Respondent.

Dates of hearing: 7th March and 19th June, 1979.

This judgment disposes of the following tax references

(1) P. T. R. 306172: Messrs Burhan Transport Service Ltd. v. Commis sioner of Income‑tax, Rawalpindi.

(2) P. T. R. 307/72: Messrs Burban Transport Service Ltd. v. Commissioner of Income‑tax, Rawalpindi.

2. The petitioner is a, private limited company engaged in the business of public transport. For the assessment year 1969‑70 it declared an effective fleet of 8 1/3 buses and claimed towards repairs a sum of Rs. 1,83,356. For the year 1970‑7I, it declared an effective fleet of 81/3 buses and" claimed Rs. 1,93,377 for repairs. The Income‑tax Officer applied a standard formula of normal repair expenditure of 13,000 per old bus and 6,500 per new bus. The new and the old buses were worked out for each year and disallowance of Rs. 76,523 for the year 1969‑70 and Rs. 1,02,370 for the next year was ordered. On appeal 15,000 was allowed in 1969‑70 for the element of accident and 15,000 for the next year on account of depreciation. The applied rates were confirmed. The petitioner has raised what he consi ders to be a question of law arising out of Tribunal's order for decision of this Court. It is as follows: ‑

"Whether on the facts and in the circumstances of the case there was any material to uphold the disallowance in repairs as made by the Income tax Officer."

3. It is not denied by the petitioner that no stock register of the parts purchased and utilised eras maintained on regular basis. The books of i.14 accounts were also found to be defective. In this background Rs. 13,000, per old bus and Rs. 6,500 per new bus was adopted as the proper repair expenditure. The petitioner has provided us with the figures of earlier years in order to demonstrate that the disallowance is not relateable to any relevant consideration. In the immediately preceding year that is 1968‑69 the total fleet of 4 5/12 buses is shown against which Rs. 1,11,671 was claimed which was allowed. For the three years preceding, the figures are not so helpful to the petitioner, for in 1967‑68 against a fleet of 6 buses Rs. 80,870 way said to have been allowed and for the year 1956‑67 against the same number Rs. 51,846 was allowed and in 1,965‑66 it was Rs. 55,700 for a fleet of 6 buses. Keeping in view the past history as depicted by the petitioner himself it cannot be said that the variance is so great as to appear to be arbitrary. It has also to be kept in view that the accident expenditure has been separately provided for and similarly heavy expenditure on purchase of spare parts is not covered by this permissible expenditure. In the absence of the stock registers and proper accounts the controversy raised by the petitioner remains substantially in the domain of facts and poses no question of law. The finding of fact recorded is that there is no stock register of the purchase and issue of the spare parts and that the accounts kept are defective. In the absence of these documents the authorities have adopted a fair and relevant standard for evaluating the reasonableness of the expenditure on repairs.

4. We find no merit and answer the question in the affirmative. The petitioner shall bear the costs of the proceedings as well.

Appeal dismissed.

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