TMI Blog1975 (4) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... ase, when the accounts were admittedly defective the assessee's books of account were liable to be rejected and estimate was called for ? " The years of assessment are 1967-68, 1968-69 and 1969-70. The assessee undertakes execution of contracts and a large proportion of its work is executed through sub-contractors. In regard to the works undertaken by sub-contractors, under the agreements, the assessee was entitled to five per cent. of the net receipts. The Income-tax Officer completed the assessment by calculating the income of the assessee on adoption of five per cent. in regard to the works done through sub-contractors and by adopting 121 per cent. rate on the receipts relating to contract work taken directly by the assessee. In the a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o 5 per cent. of the total value of the bills. The value of contracts executed by the appellant itself in each of the years is quite small compared to the value of contract works executed by the sub-contractors. Thus, for instance, in the assessment year 1967-68, the value of the bills received on account of the execution of contracts on own account was only Rs. 5,30,776 as against the gross receipts of Rs. 60,92,958, in the assessment year 1968-69, the value of own contract work was Rs. 8,40,740 as against the gross receipts of Rs. 43,64,302 and in the assessment year 1969-70, the value of contracts on own account amounted to Rs. 2,40,767 against the total value of bills at Rs. 6,67,094. So far as the claim of the assessee for acceptance o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... enditure that could be allowed in respect of overall supervision and liaison work, etc. In the circumstances, we find considerable force in the appellant's contention that the expenditure claimed as per books of account should have been allowed and there is no justification for resorting to estimate when the Appellate Assistant Commissioner has admitted the fact that the assessee having had the necessity to maintain establishment for various activities enumerated in his order. We, therefore, direct acceptance of trading results disclosed by the assessee including the expenses claimed by it and delete the additions sustained in each of the years. " At the hearing, learned standing counsel is not in a position to indicate any factual error ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
