TMI Blog2014 (7) TMI 1207X X X X Extracts X X X X X X X X Extracts X X X X ..... tion had claimed net profit rate of 5.29% which was increased to 12% by the Assessing Officer and was reduced to 6.5% by the CIT (Appeals). The assessee was engaged in the business of civil contractor and in the totality of the facts and circumstances, we hold that the net profit rate of 7% be applied to determine the income in the hands of the assessee. The Assessing Officer is directed to recompute the income of the assessee accordingly. - Decided partly in favour of revenue - ITA No. 188/Chd/2014 - - - Dated:- 15-7-2014 - SHRI T.R.SOOD, ACCOUNTANT MEMBER AND Ms. SUSHMA CHOWLA, JUDICIAL MEMBER Appellant by: Shri Manjit Singh, DR Respondent by: Shri Birj Bhushan Bansal O R D E R Per SUSHMA CHOWLA, J.M.: ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orted in 252 ITR 412 was followed which related to the A.Y. 1988-89 whereas the present case relates to the A.Y.2010-11 i.e. the year after introduction of section 44AD of the Income Tax Act, 1961 of which Clause (iii) of section 44AD clearly indicates that while working out the net profit the depreciation calculated on the written down value of the assets had been deemed to have been actually allowed, and also because the AO had specifically mentioned in the assessment order that no deduction of depreciation was to be allowed? 4. In the facts and circumstances of the case and in law, the Ld. CIT(A) erred in allowing the depreciation claimed whereas the Hon'ble Punjab Haryana High Court, Chandigarh have held in the case of S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... gh whom cash purchases of bricks, bajri, gatka, sand, etc. were made. In addition, various discrepancies were noted by the Assessing Officer under various heads of expenditure and show cause notice was issued to the assessee which is reproduced under para 3 at pages 2 to 6 of the assessment order. The Assessing Officer in view of various discrepancies rejected the books of account of the assessee under section 145(3) of the Act and thereafter applied the net profit rate of 12% to determine the income in the hands of the assessee. 5. The CIT (Appeals) upheld the rejection of books of account. However, the CIT (Appeals) was of the view that the GP rate applied by the Assessing Officer before allowing interest and salary to i ..... X X X X Extracts X X X X X X X X Extracts X X X X
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