TaxTMI 
TaxTMI 
2016 (6) TMI 546
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....(ii) Whether on the facts and in the circumstances of the case and in law the ld CIT(A) has erred in not appreciating that facts in A.Y. 2005-06 to 2008-09 were distinguishable as no evidence of undisclosed and unexplained expenditure were found in those years as detected during survey in A.Y. 2010-11." 2. The assessee is a civil contractor. He filed return for A.Y. 2010-11 on 15/10/2010 declaring total income of Rs. 6,04,99,939/-. The case was scrutinized U/s 143(3) of the Income Tax Act, 1961 (in short the Act). Both the grounds of the revenue's appeal are against deleting the trading addition estimated by the Assessing Officer @ 7.5% subject to depreciation and interest and incriminating documents found during the course of survey. The....
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....imself admitted in reply that complete bills/vouchers could not be produced as the same were lying at work site and same were misplaced. He had further admitted that it was not possible for him to maintain the proper record and the expenses are not vouched or supported by self made vouchers. There was a survey U/s 143(3A) of the Act on 14/7/2011. In survey proceedings, it was found that the assessee was not recording all his transactions in his books of account. During the survey proceedings, various incriminating documents were found and impounded. As per Annexure-A-1, which was an Ultra-tech Cement diary, there were some entries which depicted cash payment by the assessee to sub-contractor Shri Birbal Singh Shoora. During the survey proce....
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....profit rate was on account of proprietory concern having been converted into the partnership firm. This resulted in an increase in profit rate by 1.37% because joint venture charges were no longer payable. The ld CIT(A) after considering the assessee's contention directed that a profit rate of 8.89% can be applied in the case of assessee. Therefore, he found that the approach of the ld CIT(A) was logical and scientific. Thus, he applied NP rate @ 8.9% on the contract receipt of the assessee. He further relied on the following decisions for estimating the income of civil contract. (i) Commissioner of Sales Tax Vs. H.M. Esufali, 90 ITR 271 (SC) (ii) Kausaray Bearing P Ltd. Vs. ACIT 270 ITR 235 (Raj). (iii) CIT Vs W.Hussain 171 ITR 405 (Pat....
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....arate addition in respect penalty of Rs. 8,43,999/- and donation of Rs. 3,60,000/- is called for as the income has been estimated by applying NP rate. Therefore, estimation of profit @ 7.5% subject to depreciation of Rs. 2,09,83,906/- and interest of Rs. 31,15,739/= works out to Rs. 3,35,86,005/=as against net income from contract assessed by the AO at Rs. 4,86,73,732/-. Assessee's appeal is partly allowed. The ld CIT(A) had also allowed the assessee's appeal on the observation made by the ld Assessing Officer that payment of Rs. 40,43,000/- in cash was made to M/s Shoora Construction company proprietor Shri Birbal Singh Shoora as ld Assessing Officer has estimated the income by rejecting book result and applied NP rate @ 8.9%. Therefore,....
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.... knowledge and repute in regard to the assessee's circumstances and his own knowledge of previous returns by and assessment of the assessee and all other matters which he thinks will assist him in arriving at a fair and proper estimate and though there must necessarily be guess work in the matter, it must be an honest guess work. The ld Assessing Officer applied NP rate @ 8.9% arbitrarily and without considering the assessee's own past history. He summarized the past history of the case as under:- A.Y. Gross Contract Receipts N.P. rate declared by assessee (before dep. and interest) N.P. rate applied by A.O. (subject to depreciation) N.P. rate applied by CIT(A) and upheld by ITAT (subject to depreciation and interest) 2010-....
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....been recorded in the books of account of the assessee on receipt of claim of such expenditure. Further once trading addition is made by estimating the NP rate, no addition for such payment can be made. Even the ld Assessing Officer has not made any addition for such amount considering the explanation of the assessee. Therefore, this ground of the department is liable to be quashed. 6. We have heard the rival contentions of both the parties and perused the material available on the record. Whatever defects pointed out by the Assessing Officer is justified, the rejection of books of account U/s 145(3) of the Act. When books of account has been rejected, the only alternate before the Assessing Officer to estimate the income on the basis of pa....