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2023 (1) TMI 710 - AT - Income TaxReopening of assessment - contractual receipt treated as income of assessee - addition to a reasonable profit of 8% as laid down u/s 44AD - Case of assessee was reopened on the basis of ITS data information that assessee has receipt contractual payment - HELD THAT:- It is not disputed that in response notice under section 148, the assessee neither filed return nor responded to various notices. However, before NFAC/Ld. CIT(A) the assessee in his statement of fact and in written submission submitted that assessee received gross receipt of Rs.8,96,080/- from Paras Pumps Pvt. Ltd. The assessee also stated that entire contractual receipt was declared by assessee while filing his return of income for assessment year 2010-11 and such fact are duly recorded by NFAC/Ld. CIT(A). NFAC/Ld. CIT(A) despite that while recording such fact has not directed the Assessing Officer to find out the fact, whether the assessee has filed return of income or not. The NFAC/Ld. CIT(A) confirmed the addition of entire contractual receipt. It is settled law that entire receipt cannot be treated as income and find that in the case of Commissioner of Income-tax-XII vs. Subodh Gupta [2014 (12) TMI 479 - DELHI HIGH COURT] held that in absence of material to show net profit rate, presumptive net profit rate of 8% as stipulated in section 44AD could be taken for estimation of income. Hence, considering all direct the Assessing Officer to restrict the addition to the extent of 8% and re-compute the assessment in terms of above condition. In further direct the assessing officer that in case no set off of TDS is given in response to the original return of income the assessee be granted set off of TDS in the credit of assessee. Appeal of the assessee is partly allowed.
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