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2013 (12) TMI 134 - AT - Income TaxContract works - estimation of income - Held that:- Following Ferro Concrete Construction (India) (P) Ltd. V/s. CIT [2005 (1) TMI 93 - MADHYA PRADESH High Court] - It is incidental to the business activity, any income earned by sale of empty bags/containers/drums cannot be said to be an income from other sources but it is an income from business activity of the assessee - Therefore, The income from metal account, miscellaneous income or interest on fixed deposits are relatable to the business of contracts carried on by the assessee - However, interest income earned on fixed deposits is chargeable to tax as income from other sources - Also the income should be assesseed by applying net profit rate of 8% to this income - Partly allowed in favour of assessee. Disallowance u/s 40(a)(ia) - Held that:- Following CIT V/.s. Banwari Lal Banshidhar [1997 (5) TMI 37 - ALLAHABAD High Court] - No disallowance could be made in view of the provisions of Section 40A(3) read with rule 6DD(j) of the Income-tax Rules, 1962, as no deduction was allowed to and claimed by the assessee - When the gross profit rate was applied, that would take care of everything and there was no need for the Assessing Officer to make scrutiny of the amount incurred on the purchases made by the assessee - Decided against Revenue.
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