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2018 (1) TMI 1542 - AT - Income TaxDisallowance of expenses on wages, petrol, hire charges etc.- CIT-A applied net profit rate of 11.5% on an adhoc basis instead of head-wise disallowances made by the A.O. - HELD THAT:- When the books of accounts of the assessee were rejected u/s 145(3) of the Act then, the income of the assessee is required to be assessed on estimate basis and best judgment of the AO. Therefore, the following earlier decision of this Tribunal in assessee’s own case, we do not find any error or illegality in the impugned orders of the ld. CIT(A) qua this issue. Disallowance u/s 40(a)(ia) - non deduction of tax at source - amount paid or payable at the end of the year - CIT(A) has deleted the said disallowance on the ground that the entire expenditure claimed by the assessee was paid and nothing was payable at the end of the year - whether any disallowance u/s 40(a)(ia) would be made when the income of the assessee is assessed on the basis of net profit estimated by the ld. CIT(A) after rejection of the books of accounts of the assessee u/s 145(3)? - HELD THAT:- As decided in M/S POWER LINERS VERSUS A.C.I.T., CIRCLE-3, JAIPUR [2018 (1) TMI 512 - ITAT JAIPUR] once the n.p. rate is estimated, the AO cannot based this disallowance on the same books of accounts for the purpose of disallowance by invoking provisions of section 40(a)(ia) of the Act or general disallowance u/s 37 of the Act. The estimation made by the AO of net profit will take care of every addition related to business income or business receipts and no further disallowance can be made. Also see ARJUN BHOWMICK [2014 (8) TMI 1075 - CALCUTTA HIGH COURT] - Appeal of the Revenue is dismissed.
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