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2018 (11) TMI 634 - AT - Income TaxPresumptive income - Application of income u/s 44AD or 44AE - Assessee is free to offer the income on presumptive basis under section 44AE - penalties levied under sections 271A and 271B - Held that:- AO has also estimated the income of the assessee by applying net profit @ 8% on the gross receipts. AO has not given any basis of adopting the net profit of 8% and, therefore, it is apparent that the net profit at 8% as adopted as per the provisions of section 44AD which is also part of the provision of computing the income on presumptive basis. Hence when the assessee fulfills the conditions as prescribed u/s 44AE, then the income computed by the assessee on the basis of said provision cannot be disturbed by applying the other basis which is not applicable in the case of the assessee. Hence, we delete the addition made by the AO in respect of the income from business of plying the trucks which were deployed with M/s. HG Infra Engineering Pvt. Ltd. Addition made on account of deposits made in the bank account of the assessee -Held that:- We note that the gross receipts of the assessee from the business of plying the trucks deployed with M/s. HG Infra Engineering Pvt. Ltd. is ₹ 61,16,640/- and there is also pension income of the assessee which is more than sufficient to explain the source of deposits of ₹ 5,23,020/- in the bank account. From the details of bank account it is evident that there are certain cash deposits and certain deposits by clearing cheques and, therefore, once the gross receipts of the assessee is more than ₹ 61 lacs, then the said gross receipt itself is a source for depositing the amount in the bank account of the assessee. Accordingly, no justification in making the addition on account of the deposits in the bank account of ₹ 5,23,020/- when the gross receipts of the assessee was found to be more than ₹ 61 lacs. Hence the addition is deleted. When the income is computed under the presumptive provisions of section 44AE, then the provisions of section 44AA and 44AB shall not apply in so far as they relate to the business of plying, hiring or leasing of goods carrier. Accordingly, once the assessee’s income is accepted under section 44AE, then the provisions of section 44AA and 44AB are not applicable and consequently there can be no default on the part of the assessee for maintaining the regular books of account as well as getting the same audited. Accordingly, the penalties levied under sections 271A and 271B are deleted - Decided in favour of assessee
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