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2015 (7) TMI 1403 - AT - Income TaxRejection of books of accounts u/s 145 - reasonable rate of profit @12% on contract receipt - HELD THAT:- We find considerable cogency in the assessee’s counsel submission that on similar facts the judicial courts have allowed a lower rate upto maximum of 8% on gross receipts which is reasonable in the circumstances of the case. The rate applied should be based on valid basis such as past history of the case, nature of business, past years profits. As further find that force in the assessee’s counsel version that the assessee Sh. Nand Kishore Pundir is a contractor engaged in supply of machines JCB, Construction of roads & buildings. So he is giving multivaried services. Whereas the case law relied upon by the AO titled as “PARBHAT KUMAR, SIRSA", Parbhat Kumar, Sirsa was civil contractor engaged in civil construction. So nature of work done is not same in both the cases. Therefore, to compare both cases & levy high estimated rate of 12% is not just. End of justice would be served if profit rate @8% gross receipt is adopted. Accordingly we direct the AO to adopt profit rate @8% on Gross receipts and re-compute the income of the assessee accordingly. Appeal filed by the assessee stands allowed for statistical purposes.
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