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2013 (3) TMI 561 - HC - Income TaxBogus and unverified purchases - appellant argued that earlier CIT(A) has applied 11% as net profit rate of the contract receipts but after remand has applied 8% of the contract receipts as a net profit rate - Held that:- The Tribunal in the earlier appeal found that the books of account were not rejected by AO therefore, the best judgment assessment could not be framed by the CIT(A). However, after remand, it has been found that in fact the AO has proposed to reject the books of account and to compute income by applying net profit @ 8% of the contract receipts. - Since the assessee has not maintained proper books reflecting the purchase of the material and the wages payable or paid, the revenue has no option but to frame best judgments assessment. It is not the case of the revenue that the assessee has not executed the work at all. In fact the order passed by the AO shows the details of the work executed by the assessee. AO in the following assessment year applied 8% net profit rate on contract receipt. There is no dispute to the argument that each of the assessment year is independent proceedings and the AO is within its jurisdiction to frame assessment by applying net rate of profit which he found prudent. But if in the earlier assessment years as well as in the subsequent assessment year, a particular net profit rate has been applied, it is a prudent rate of income, which has been applied by the CIT (A). Such finding cannot be said to give rise to any substantial question of law in the present appeal.
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