TMI Blog2016 (7) TMI 967X X X X Extracts X X X X X X X X Extracts X X X X ..... pinning and Weaving Mills Ltd. 1979 (10) TMI 45 - BOMBAY High Court). In this case, we find that the net profit estimated at 17.08% is a very possible view on the facts found. No substantial question of law Tribunal directing the Assessing Officer to allow deduction towards remuneration and interest, even in case of estimated net profit - Held that:- There can be no quarrel with the submissions of Mr. Kotangale. In any event, the Assessing Officer would need to redetermine the book profits of the respondent-assessee as a consequence of the impugned order of the Tribunal. At that stage the ceiling provided under Section 40(b) of the Act would also be considered while allowing deduction on account of remuneration and interest paid to the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for the subject assessment year the respondent-assessee did not disclose any profits on its above project as it was following the Project Completion Method. (b) On 20th April, 2006 there was a search on the respondent-assessee under Section 132 of the Act. During the course of the search it was found that during the previous year relevant to assessment year under consideration it was found that the respondent-assessee had sold 14 units in its Prime Mall Project and received 65% of the total sales consideration as 'on money'. Consequent to the search, the respondent-assessee contended that in the subject assessment year no income is chargeable to tax as it is following the Project Completion Method of Accounting. Therefore the pr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... lied is 17.08%. The Tribunal rendered a finding that AnnexureL on which reliance was placed which indicated a net profit of 28.18% was merely an estimated working done by the respondent-assessee. In the above view, the issue was restored to the Assessing Officer to work out the taxable profits after adopting a reasonable net profit of 17.08% on its gross sales turnover of ₹ 11.60 crores in the subject assessment year. (e) The grievance of the Revenue before us is that the adoption of net profit of 17.08% as determined by the Tribunal is not correct. Although the questions as formulated does not state that the adoption of any particular rate of net profit, in submissions it is submitted that it has to be replaced/substituted by 65% ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ermined. (b) Mr. Mistri, the learned counsel for the respondent-assessee has no objection to the same. (c) There can be no quarrel with the submissions of Mr. Kotangale. In any event, the Assessing Officer would need to redetermine the book profits of the respondent-assessee as a consequence of the impugned order of the Tribunal. At that stage the ceiling provided under Section 40(b) of the Act would also be considered while allowing deduction on account of remuneration and interest paid to the partners. (d) However as nothing has been urged in support of the questions framed, we we are unable to see how a substantial questions of law arises in the context of the facts arising in this case. Therefore, question no.2 as framed is not ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
