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2022 (10) TMI 123 - AT - Income TaxEstimation of income - bogus purchases - bogus purchases by applying the provisions of section 44AD - HELD THAT:- CIT(A) has estimated the net profit at 8% as prescribed in section 44AD of the I.T. Act to be reasonable in the case of civil contractors. The justification given by the Ld.CIT(A) in deleting the said addition made on account of bogus purchase and also on the estimation of net profit @8% as per the provisions of section 44AD, is satisfactory. - Decided against revenue. Addition u/s 68 - unexplained cash credit (loan) - HELD THAT:- As assessee has furnished required details to substantiate its claim pertaining to the addition made under section 68 - CIT(A) has also dealt with this issue extensively. On this note, we do not find any infirmity in the order of the Ld.CIT(A) in deleting the said addition made under section 68 of the I.T. Act. In the result, these grounds of appeal filed by the Revenue are dismissed. Addition u/s 14A r.w.r.8D - CIT-A restricted addition - Assessing Officer has made disallowance under section 14A r.w.r 8D(2) on the ground that the funds invested in the exempt income earning assets could not be segregated from the funds invested in the business of the assessee - HELD THAT:- Upon perusal of the assessee’s submission and the decisions cited by the Ld.AR, we are of the considered view that there is no fallacy in the decision of the Ld.CIT(A) in restricting the disallowance only to the extent of exempt income earned by the assessee. In this context, this ground of appeal filed by the Revenue is dismissed. Estimating 8% of alleged unsupported project expenses by treating the same as bogus expenditure - As we have already given a detailed order in the above mentioned appeals of the Revenue on this ground by confirming the said addition on the basis of 8% estimation relying on the decision of Rattan SinghRathod [2013 (1) TMI 133 - ITAT MUMBAI] wherein the assessee’s nature of business was also contracts and sub contracts, we are inclined to follow the decision and thereby the estimation of net profit rate @8%, in our view, is justifiable.
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