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2017 (4) TMI 656 - AT - Income TaxEstimation of net profit from business - Held that:- Respectfully following the decision of coordinate bench in assessee’s own case for the assessment year 2009-10, we direct the A.O. to estimate net profit of 8% on main contract works, 5% on sub contract works and 1% on sub contract works given to third parties. Deductions towards depreciation, remuneration to partners and interest on partner’s capital accounts - Held that:- We are of the view that depreciation, interest on capital and remuneration to partners is deductible even after estimation of net profit from the contract receipts. Therefore, we direct the A.O. to allow depreciation, interest on partner’s capital account and remuneration to partners against income estimated from contract receipts. Additions towards income from other sources being interest earned on fixed deposits - Held that:- Interest earned from fixed deposits kept in banks for the purpose of obtaining bank guarantee is assessable under the head ‘income from other sources’, but not under the head ‘income from business’. The CIT(A) after considering the relevant provisions has rightly upheld the action of the A.O. treating interest income under the head ‘income from other sources’.
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