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2013 (10) TMI 660 - HC - Income TaxEstimation of Income – Held that:- It is well settled that ignorance or innocence of law is no excuse - Once he commenced business of construction in 2000 and if he has receipt of income as seen from the records, he is expected to file returns - If he knew that the accounts need to be audited by an auditor, definitely, the Company was also aware of the fact that they were expected to file returns - Therefore, inexperience or ignorance cannot be a ground not to file returns. Losses Suffered – Held that:- Sustaining loss definitely will not entitle an assessee, who is required to file returns, not to file returns - He can show loss and then file returns, the Tribunal was justified in saying it is not a good ground at all. Applicability of Section 44-AD – Held that:- The activity carried on by a builder or realtor would not attract the provisions of Section 44-AD and it would rather attract the case where the assessee were to be a civil contractor - The income earned by the Company would be more than the income earned by a civil contractor as opined by the Tribunal - there was no material to substantiate the contention that the project was not completed even upto 5% - All the receipts during this period plus non filing of the returns and disclosure of the receipt of accounts in the search and seizure would clearly show there was no bona fides on the part of the appellant Company in not filing the returns, thus the estimation of profit at 20% from the receipts of the income for the assessment year 2002-2003 is justified – Decided against Assessee.
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