TMI Blog2015 (7) TMI 445X X X X Extracts X X X X X X X X Extracts X X X X ..... n of books of accounts by the AO has been upheld by the CIT(A). The Tribunal has also upheld the conclusion of the CIT(A) in this regard and we are unable to see any valid reason to take a different view on the similar issue. We also respectfully hold that the benefit of the ratio of the decisions relied by the revenue is not available for the revenue as the facts and circumstances of these cases are clearly distinguishable from the factual matrix of the present case. Therefore, we hold that the present case of the assessee is squarely covered in favour of the assessee by the order of the Tribunal in the case of Radha Ballabh Nest Build Pvt. Ltd. (supra). - Decided against revenue. - ITA NO. 6011/DEL/2012 - - - Dated:- 12-3-2015 - Shri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... per profit and loss account. Being aggrieved by the above assessment order, the assessee preferred an appeal before the CIT(A) which was allowed by passing the impugned order. The CIT(A) upheld the rejection of books of account but the estimated addition of 75% of expenses was dismissed and the AO was directed to adopt the income of the assessee at 2.24% of the total gross receipts during the year under consideration. Now, the aggrieved revenue is before this Tribunal with the sole ground as reproduced hereinabove. 3. We have heard arguments of both the sides and carefully perused the relevant material placed on record. 4. On the issue of violation of Rule 46A of the Income Tax Rules 1962, from vigilant perusal of the assessment order ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rcumstances including decision of ITAT Delhi F Bench in ITA No.2044/Del/2011 for AY 2008-09 in the case of ITO vs Radha Ballabh Nest Build Pvt. Ltd. wherein net profit @2.24% has been upheld by the Tribunal dismissing the appeal of the revenue. Ld. Counsel further contended that the ratio of the case laws relied upon by the ld. DR are not applicable to the present case. 7. On careful consideration of above submissions, at the very outset, we note that in the similar set of facts and circumstances in the case of ITO vs Radha Ballabh Nest Build Pvt. Ltd. (supra) dismissing the appeal of the revenue, the coordinate bench of this Tribunal has upheld the estimation of net profit @2.24% of the gross receipts from M/s PACL India Ltd. The oper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the AO affirming the net profit rate at 12%. The Hon ble High Court held that if net profit rate is perverse and arbitrary, the findings so rendered shall be illegal and restored the matter to the file of the AO for re-determination of net profit by reference to and after due consideration of relevant factors. Hence in our humble understanding, Hon ble High Court held that if net profit rate is perverse and arbitrary, then the findings so rendered shall be illegal and with this proposition, the matter is restored to the file of the AO for re-determination of net profit. We also respectfully note that Hon ble High Court did not determine any net profit rate, hence, there is no guideline about suitable and appropriate percentage of profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... . Counsel of the assessee submitted that in the case of Subodh Gupta (supra), no instance was quoted by the Revenue about any higher profit rate and in absence of any contrary data and details the net profit rate of 8% was approved by Hon ble High Court but in the present case, there were number of cases wherein in the similar set of facts and circumstances, net profit rate of 2.24% was accepted by the department in several suitably comparable cases including order in the case of Radha Ballabh Nest Build Pvt. Ltd. (supra), therefore, the ratio of the decision of Subodh Gupta (supra) does not support the case of the Revenue in the present appeal. 11. On careful consideration of above contentions of both the sides, first of all, we noted t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... has been upheld by the CIT(A). The Tribunal has also upheld the conclusion of the CIT(A) in this regard and we are unable to see any valid reason to take a different view on the similar issue. We also respectfully hold that the benefit of the ratio of the decisions relied by the revenue is not available for the revenue as the facts and circumstances of these cases are clearly distinguishable from the factual matrix of the present case. Therefore, we hold that the present case of the assessee is squarely covered in favour of the assessee by the order of the Tribunal in the case of Radha Ballabh Nest Build Pvt. Ltd. (supra). Accordingly, sole ground of the revenue being devoid of merits is dismissed. 13. In the result, the appeal of the re ..... X X X X Extracts X X X X X X X X Extracts X X X X
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