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2015 (7) TMI 445 - ITAT DELHI

2015 (7) TMI 445 - ITAT DELHI - TMI - Assessment of income of assessee at 2.24% of gross receipts - CIT(A) admitting additional evidences in the form of details of comparable cases without providing any opportunity of rebuttal to the A.O. under Rule 46A - Held that:- In the case of ITO vs Radha Ballabh Nest Build Pvt. Ltd.(2015 (6) TMI 790 - ITAT DELHI), the Tribunal, on identical set of facts and circumstances, has upheld the order of the CIT(A) and the addition made by the AO has been deleted .....

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d 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 G.D. Agrawal And Shri Chandramohan Garg JJ. For the Appellant .....

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.24% of gross receipts by admitting additional evidences in the form of details of comparable cases without providing any opportunity of rebuttal to the A.O. under Rule 46A? 2. Brief facts giving rise to this appeal are that the assessee company was engaged in the business of land development work during the year under consideration. The assessee company filed return of income on 25.09.2008 declaring an income of ₹ 1211/- and the same was processed u/s 143(1) of the Act. Subsequently, the .....

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d 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 relev .....

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he CIT(A) was not correct in directing the AO to adopt the income of the assessee at 2.24% of gross receipts by admitting additional evidence in the form of details of comparable cases. Ld. DR further submitted that the CIT(A) ought to have considered other better comparable cases on the issue of estimation of net profit. Ld. DR has placed reliance on the decision of Hon ble High Court of Punjab & Haryana dated 20.11.2014 in ITA No. 269 and 225 of 2014 in the case of Telelinks vs CIT, Bathin .....

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plied that the case of the assessee is squarely covered in favour of the assessee by various decisions of the Tribunal on the similar set of facts and circumstances 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 applic .....

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re covered by earlier decision of the Tribunal in the group case of the assessee as well as the recent order of the Tribunal for the similar assessment year 2008-09 in ITA No. 2042 and 2043/D/2011 (Supra) we do not find infirmity in the first appellate order. In that case also the Tribunal has upheld the first appellate order on identical issues. Addition made by the AO on account of TDS treating the amount claimed from PACL India Ltd. and PGF India Ltd. as real income of the assessee deleted by .....

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eld. The grounds are accordingly rejected. 8. First of all, it would be just and proper to consider the applicability of the decisions relied by the ld. DR appearing for the Revenue. In the case of Telelink (supra), the AO estimated net profit @12% and the CIT(A) reduced the same @6%. The Tribunal, allowing the appeal by the revenue, set aside the order of the CIT(A) by restoring that of the AO affirming the net profit rate at 12%. The Hon ble High Court held that if net profit rate is perverse .....

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on ble High Court did not determine any net profit rate, hence, there is no guideline about suitable and appropriate percentage of profit. 9. We further note that the Hon ble Punjab & Haryana High Court in the case of CIT vs Kamlesh & other cases (supra), their lordships in the cases of individuals held that the income disclosed by the assessee as their income has been assessed to tax as income in terms of section 44AD of the Act, then it was held to be sustainable. Ld. Counsel of the as .....

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se contentions of the ld. Counsel as the facts of the extant case are clearly distinguishable from the facts of the case of CIT vs Kamlesh etc. (supra). 10. In the case of CIT vs Subodh Gupta, the Hon ble Jurisdictional High Court of Delhi held that the appellate authorities have not applied section 44AD of the Act but where difficulty arose as they had to estimate reasonable rate of net profit, hence in absence of any data and details, they applied net profit rate as mentioned in section 44AD o .....

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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 that on our specific query from ld. DR, we have been informed by the ld. DR that the decisions of the Tribunal (sup .....

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