TMI Blog2013 (4) TMI 833X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee. Therefore, set off was allowed out of interest. Since it was a negative figure of interest, therefore, it was considered not to be added to the income of the assessee. On considering of the above facts, particularly when no opportunity has been given by the Assessing Officer before making this addition, the ld. CIT(A) was justified in deleting the addition on account of interest. The ld. CIT(A) has passed the speaking order on both the grounds. Therefore, there is no violation of law. Accordingly, the appeal of the Revenue has no merit and is dismissed. - ITA No. 141/Alld./2012 - - - Dated:- 29-4-2013 - SHRI BHAVNESH SAINI, JUDICIAL MEMBER AND SHRI A.L. GEHLOT, ACCOUNTANT MEMBER Appellant by : Shri Jagdish, CIT / DR ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ceedings. (v). Whether on the facts and circumstances of the case Ld. CIT(A) is justified in deleting the additions and allowing assessee s appeal ignoring the provisions of section 250(6) of the IT Act. 2. Briefly, the facts of the case are that the assessee is a firm and the nature of business is civil contractor. The return of income was filed at an income of ₹ 69,65,610/-. The assessee has shown profit rate of 6.76% in assessment year under appeal as compared to 6.97% and 6.17% in preceding assessment years 2008-09 and 2007-08. The assessee filed audited accounts, but did not produce the books of account, bills and vouchers etc. Therefore, verification of expenses and correctness of liabilities could not be ascertained. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ad Bench in the case of Gupta Construction company vs. ACIT, 84 TTJ 46, which shows that the assessee has disclosed profits closely comparable with the parameters accepted by the department in which the deduction of royalty and trade tax were allowed and further deduction was allowed on account of interest paid to the bank and interest and salary to the partners. It was submitted that looking to the history of the assessee and material on record, appropriate profit should be computed. The ld. CIT(A) confirmed the rejection of books of account, however, with regard to no profit element like trade tax etc. it was directed that the same be deducted from the gross receipts before applying net profit rate and as per decision of ITAT Allahabad Be ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... est, therefore, addition is found to be unjustified. The ld. CIT(A) computed the business income of the assessee at the end of the appellate order and by applying the profit rate of 8% further deduction was allowed on account of interest and salary paid to the partners as was allowed by the Assessing Officer and further depreciation and interest paid to the banks were allowed as deduction and taxable income was computed at ₹ 72,91,925/- as against returned income of ₹ 69,65,610/-. The appeal of the assessee was partly allowed. 4. The ld. DR besides relying upon the grounds of appeal also relied upon the order of the Assessing Officer and the decision in the case of Saraya Engineering Works vs. CIT, 168 ITR 455 and decision in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... treatment while computing the business income of assessee. On interest on FDRs, the ld. CIT(A) specifically noted, the addition is made by the Assessing Officer on this head without giving any opportunity of hearing to the assessee. Therefore, on this reason itself, the order of the Assessing Officer is liable to be set aside. Further, the ld. CIT(A) found that FDRS are purchased for security purpose for obtaining the contracts which is connected with the business activities of the assessee. Therefore, set off was allowed out of interest. Since it was a negative figure of interest, therefore, it was considered not to be added to the income of the assessee. On considering of the above facts, particularly when no opportunity has been given by ..... X X X X Extracts X X X X X X X X Extracts X X X X
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