TMI Blog2007 (1) TMI 225X X X X Extracts X X X X X X X X Extracts X X X X ..... ared, which gives GP rate of 2.88 per cent. The comparative figures in asst. yrs. 2001-02 and 2002-03 are given in the following chart: ----------------------------------------- Asst. yr. Receipts GP GP Rate ----------------------------------------- 2001-02 1,03,81,762 7,35,253 7.08 2002-03 1,15,93,407 8,15,512 7.00 2003-04 3,12,64,977 9,01,249 2.88 ----------------------------------------- 3. The AO wanted to know the reason of the steep fall of the GP rate. The assessee explained the reasons as the increase in the contract receipts to three times, rise in the rates of diesel from Rs. 19.25 per litre to Rs. 23.68 per litre and the work during the period required skilled labours as compared t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e requirement of skilled labour in this year, the last year's results are rendered non-comparable. According to learned Authorised Representative the cases of similar assessees of the same assessment year who are in this line, are more akin to the results declared by the assessee and can be used as a guiding factor. The contention of the learned Departmental Representative is just opposite and he has insisted that the assessee's own results of the past year should be relied. Rival contentions have been circumspected in the light of the given facts and the reasonings adopted by both the AO and the learned CIT(A). The AO himself has not taken guidance from the results of the past year. The GP rate declared by the assessee in asst. yr. 2002-03 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mstances. Therefore, by following the above Tribunal order and further to be just and fair, keeping in view the facts in totality, we adopt GP rate of 3 per cent. The declared receipts are not in dispute. Hence, this issue is partly allowed. 8. The next ground i.e., ground No. (3) reads as under: "In the facts and in the circumstances of the case, the learned CIT(A) has grossly erred in holding that the learned AO was well justified in making following disallowances out of the expenses claimed by the appellant: Rs. 19,701 Out of the site expenses; Rs. 21,796 Out of telephone expenses; Rs. 20,000 Out of travelling expenses; and Rs. 43,200 Out of salary expenses He ought not to have held so. The Hon'ble Tribunal may very ki ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... from other sources, yet the fact remained was that the same in no circumstances, without first reducing from the income from business, could have been added further in the taxable income resulting in double taxation of the said income. He ought to have upheld so. The Hon'ble Tribunal may very kindly reverse the decision of both the lower authorities. 6. On the facts and in the circumstances of the case, the learned CIT(A) has grossly erred in upholding the action of the learned AO in treating Rs. 64,260 as the income of the appellant being interest on the fixed deposits, which the appellant has all along been offering for tax in the year of their maturity. He ought not to have upheld so. The Hon'ble Tribunal may very kindly reverse the de ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... with the learned Authorised Representative. The FDRs may have been taken under compulsion but the interest is not a part of business receipts. This has to be taxed as an income from other sources, on accrual basis because the assessee has been following mercantile system of accounting. But We agree with the learned Authorised Representative that the rate of interest adopted by the learned AO is on the higher side. The rate of 8 per cent per annum is just and reasonable. Therefore, this ground is allowed in part by modifying the finding of the learned AO to that extent. 16. Ground No. (7) reads as under: "In the facts and in the circumstances of the case, the learned CIT(A) has grossly erred in upholding the levy of interest under ss. 23 ..... X X X X Extracts X X X X X X X X Extracts X X X X
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