TMI Blog2012 (11) TMI 338X X X X Extracts X X X X X X X X Extracts X X X X ..... Income vs Income from other Sources – Income received from sale of scrap and other building materials - Held that:- Order of the CIT(A) in holding that there is no such receipts having nexus with the contract receipts received by the assessee from execution of civil construction works. Hence, the addition made by the AO and sustained by the CIT(A) of Rs. 9,10,587/- under ‘income from other sources’ is confirmed - Thus, this ground of appeal is dismissed. Disallowance u/s 40(a)(ia) – Held that:- Disallowance of Rs. 1,00,200/- made by the AO and sustained by the CIT(A) is confirmed as due default on the part of the assessee under the TDS provisions, the mandatory provisions of section 40(a)(ia) of the Act are applicable and such disallow ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n clear off depreciation @ 8%. The AO, thus, estimated the net taxable income clear of depreciation on such contract receipts at Rs. 1,44,44,644/-. 5. Aggrieved, the assessee carried the matter in appeal before the CIT(A) and submitted that the total construction turnover of the assessee during the year under consideration was Rs. 18.05. crores. It was stated that the AO had no basis for estimating the profit @8%. Profit was estimated at 8% u/s 44AD only where the gross receipts of construction business does not exceed Rs. 40 lakhs. He, therefore, contended that the question of invoking the said section in the case of the assessee does not arise. It was also stated that the assessee had maintained complete books of account which had bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cts. There is no other basis on which a different estimate can be made than the estimation of prof it by applying 8% net prof it rate. We are also o the view that there is no good reason why a net prof it rate of 8% is not applicable to a civil contractor having turnover exceeding Rs. 40 lakhs, where same is appl icable to a civil contractor those who are small, petty, having a turnover not exceeding Rs. 40 lakhs. Our above view is fortif ied by the decision of the Tribunal Special Bench in the case of Arihant Builders Development Investors Pvt. Ltd., 291 ITR 49 (SB) ( Indore) (AT). 10.4 In the facts and circumstances of the case and having regard to the above decision of Hon ble Punjab and Haryana High Court and further relying on the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ellant himself has received a part of the cost. 8. Similarly, the learned CIT(A) further erred in conf irming the addition of Rs. 1,00,200/- u/s on the ground that the assessee himself made the addition in the computation of income but this logic cannot be valid when the assessee s income was not assessed on the basis of books of account and substituted by the factor of estimation. 9. As regards the ground No. 7 pertaining to the addition of Rs. 9,10,587/- being sale proceed of scrap material, the AO noted that since in the P L A/c the assessee had shown a sum of Rs. 9,10,587/-, as miscellaneous income, which is different from the contract receipts, the same shall be added separately treating the same as income from other sources. Ac ..... X X X X Extracts X X X X X X X X Extracts X X X X
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