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2012 (9) TMI 150 - AT - Income TaxAdoption of Higher % of net profit - Assessee failed to produce books of account - AO applied net profit rate of 12% - Difference in amount of wages as found in assessee's computer during survey and amount shown in Profit & Loss A/c - Held that:- As the audited accounts are not in confirmation with print-out in possession during survey - Although print-outs taken during survey are unsigned but having great significance - As decided by CIT(A) on the basis of earlier assessment years applied net profit rate at 7% - As the fact of case are not similar to earlier assessment - AO having sufficient materials on record warranting adoption of higher percentage of net profit then the rate earlier estimated by ITAT could not be adopted - Decision matter remanded back to CIT(A). Addition on account of net interest expenditure - AO made addition on basis of TDS certificate - Corresponding interest income not shown in P&L a/c - Held that:- Paper books were available to AO & the details shows that assessee claims interest expenditure net of income therefore, no separate addition could be made on account of interest income. Decision in favor of assessee. Addition on account of Sub-contract work on estimated basis - Assessee claims that expense of sub-contract work should be reduce from gross receipt on the basis of decided case - Fact of case were not similar as assessee failed to produce books of account - AO compute income on the basis of TDS certificates - That is profit margins that he would earned if assessee execute such contract i.e half of such margin - Held that:- Assessee can claim payment made to sub-contractor as expenditure but the turnover cannot be reduced. And also there is no evidence to show that sub-contract work was given on the same rates as received by the assessee in other contracts. Decision remanded back case to AO.
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