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2014 (7) TMI 1207 - AT - Income TaxEstimation of net profit rate after rejection of books of account under section 145(3) - Held that:- The Assessing Officer in the assessment order had tabulated the defects in the books of account maintained by the assessee and in view of the exhaustive list, we are in conformity with the order of the CIT (Appeals) in rejecting the books of account under section 145(3) of the Act. Once the books of account have been rejected then the next step to determine the income of the assessee is to apply justifiable net profit rate to the receipts declared by the assessee. The assessee during the year under consideration had claimed net profit rate of 5.29% which was increased to 12% by the Assessing Officer and was reduced to 6.5% by the CIT (Appeals). The assessee was engaged in the business of civil contractor and in the totality of the facts and circumstances, we hold that the net profit rate of 7% be applied to determine the income in the hands of the assessee. The Assessing Officer is directed to recompute the income of the assessee accordingly. - Decided partly in favour of revenue
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