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TMI Blog2014 (1) TMI 1311X X X X Extracts X X X X X X X X Extracts X X X X ..... ticed some discrepancies in the claim of the TDS. Further, the Assessing Officer also noticed that the assessee is not maintaining salary and attendance register and has also not deducted EPF (Employees Provident Fund). The Assessing Officer also held that assessee is having more than 20 labourers and required to deduct the EPF. Assessee is not maintaining proper record of employees, labourers and salaries and wages paid to them. Assessing Officer held that the books of account are not reliable. Assessing Officer was not satisfied with the correctness and completeness of the accounts and estimated the gross profit @ 8% on account of total receipts of Rs.1,62,85,963/-. Against which, the assessee filed the appeal before the CIT (A) and the C ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here were no employee of the assessee, therefore, no salary and attendance register were maintained. Ld. AR also submitted that the CIT (A) has estimated the gross profit rate @ 4% without any basis. No comparable case has been quoted either by Assessing Officer or by CIT (A). The assessee's books of account were audited and, therefore, the book results of the assessee deserve to be accepted. No specific defect has been pointed out by the Assessing Officer, therefore, the rejection of the books itself is unjustified. Further, the EPF provisions are not applicable to the assessee, therefore, reliance on non-compliance of EPF is completely baseless. He further submitted that the violation of any other law have no impact on the applicability o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the attendance register, it cannot be a basis for rejecting the books of account as held by Hon'ble Andhra Pradesh High Court in the case of CIT vs. Margadarsi Chit Funds Limited reported in 155 ITR 442 (AP). Ld. AR further submitted that sample copies of payment vouchers before the Assessing Officer was produced and he has not pinpointed any defect in these copies of vouchers. He submitted that the copy of the vouchers produced before the Assessing Officer are placed at pages 19 to 119 of the paper book. Finally, he submitted that books of account were audited and no specific defect was pointed out by the Assessing Officer, hence, rejections of account was unjustified. The auditor has also not made any comments in maintaining the books of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing all the aspects of the case, we find that there were certain discrepancies in the receipts disclosed in the return of income and the TDS certificate. The receipts disclosed in the return were Rs.1,60,10,098/- and the gross receipts adopted by the Assessing Officer as per the TDS certificate was Rs.1,62,21,405/-. The assessee has disclosed net profit rate of 1.59%. The auditor has also reported that some expenses are supported by internal evidence, hence, taken as correct as entered in the books and some expenses are not fully supported. It is evident from Audit Report in Form No.3CD at page 8 of the paper book. With regard to the commends of the cash payments of more than Rs.20,000/-, auditor has reported that there was no payment of mo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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