TMI Blog2020 (1) TMI 700X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Settlement Commission in the Respondent-Assessee s own case for the other years, this exercise cannot be considered as irregular or illegal. No substantial question of law - INCOME TAX APPEAL NO. 1543 OF 2017 - - - Dated:- 9-1-2020 - NITIN JAMDAR M.S. KARNIK, JJ. Mr. Nirmal C. Mohanty for Appellant. Mr. Rahul K. Hakani for Respondent. P.C.:- The Appellant challenges the order passed by the Income Tax Appellate Tribunal dated 19.12.2016 in Income Tax Appeal No.119/Mum/2015 and C.O. No.117/Mum/2015 for Assessment Year 2009-10. 2. The Appeal pertains to the Assessment Year 2009-10. 3. The Appellant-Revenue has raised following question of law as a substantial que ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... come offered by the Respondent-Assessee based on the net profit @ 5.76% on total contracted amount. Aggrieved by this order the Appellant- Revenue filed an Appeal to the Income Tax Appellate Tribunal. By the impugned order the same has been dismissed. 6. In support of the question of law Mr. Mohanty, the learned counsel for the Appellant submitted that an information was received from the Sales Tax Department that certain parties from whom the Respondent-Assessee had purchased material were Hawala dealers and when the Respondent-Assessee was confronted with the same he could not produce the confirmation from the said parties. He submitted that merely because payment was made by crossed cheque was not enough to establish that the pu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... quantity of the work that the payment was released. It is also noted by the Commissioner that the Assessing Officer did not doubt about the completion of the contract work and that the consumption of the material by the Respondent-Assessee which was duly verified by the Engineers of the Municipal Corporation. The Commissioner of Income Tax (Appeals) and the Tribunal opined that without actually consuming the raw materials, the work done by the Appellant could not have been possible. 9. It is in this context, the observations of the Division Bench in the case of the Principal Commissioner of Income Tax- 17 vs. M/s. Mohommad Haji Adam Co. need to be referred :- 8. In the present case, as noted above, the assessee was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the regular books during Financial Year 1997-98 is concerned, we are of the view that the assessee cannot be punished since sale price is accepted by the revenue. Therefore, even if 6 % gross profit is taken into account, the corresponding cost price is required to be deducted and tax cannot be levied on the same price. We have to reduce the selling price accordingly as a result of which profit comes to 5.66 %. Therefore, considering 5.66 % of ₹ 3,70,78,125/- which comes to ₹ 20,98,621.88 we think it fit to direct the revenue to add ₹ 20,98,621.88 as gross profit and make necessary deductions accordingly. Accordingly, the said question is answered partially in favour of the assessee and partially in favour of the revenue. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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