TMI Blog2020 (11) TMI 175X X X X Extracts X X X X X X X X Extracts X X X X ..... Profit declared by the assessee in the preceding year as well as in the subsequent year, which was accepted by the Assessing Officer is a reasonable and proper guidance to estimate the income for the year under consideration. Having considered the fact that the Net Profit declared by the assessee is more than the average of Net Profit for the AYs.2007-08 and 2009-10, then, even after rejection of books of accounts, no trading addition is called for. Addition made to the gross receipts of the assessee on account of the receipt from M/s.Nagarjun Construction Co., for ₹ 15,58,492/- it is noted that in response to notice u/s.133(6) the said company has furnished information of payment of ₹ 59,70,453/- as well as ₹ 15,58,492/- to the AO. AO further noted that both the TDS certificates are dated 21-06- 2008. The assessee has not disputed the fact that he has reported only ₹ 59,70,453/- but contended that this amount of ₹ 15,58,492/- is part and parcel of ₹ 59,70,453/-. This is not the fact appearing from the certificates issued by M/s.Nagarjun Construction Co. Though the payment was not received by the assessee during the year under consideration ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... g in passing ex-party order without providing reasonable opportunity to the assessee hence the order is not speaking order in the eyes of law. 3. That in any view of the matter the assessment is illegal and without jurisdiction in so far as within 12 months there was no service of notice under section 143 (2) of the Act which is mandatory requirement of the Act, hence the assessment is liable to be annulled. 4. That in any view of the matter the gross receipt as declared by the appellant is true and correct which was estimated by the Assessing Officer at ₹ 1,24,06,975.00 is highly unjustified in the facts and circumstances of the case. The allegation of the Assessing Officer about non-disclosure of correct receipt from M/s. Nagarjun Construction Co. is not correct. 5. That in any view of the matter extra addition of ₹ 5,29,882.00 is highly unjustified in the facts and circumstances of the Assessing Officer is without any material and basis on record. 6. That in any view of the matter findings and observations of the Assessing Officer in the order regarding alleged suppression and about profit are incorrect and contrary to the actual facts of the case ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arious discrepancies and defects in the books of accounts and accordingly, the book result of the assessee were rejected by invoking the provisions of Section 145(3) of the Act. The Assessing Officer therefore estimated the income of the assessee by applying the Net Profit rate before depreciation @10% on the total payments, which was re-worked out by the Assessing Officer at ₹ 1,24,06,975/-, after making the addition of ₹ 15,58,492/-, as un-accounted receipts. Consequently, the Assessing Officer has made a trading addition of ₹ 5,29,882/-. The assessee challenged the action of the Assessing Officer before the CIT(A). However, nobody has attended the proceedings/hearing before the CIT(A) and consequently the appeal of the assessee was dismissed by the CIT(A) by passing the impugned ex-parte order. 5.3. Before the Tribunal, the Ld.AR of the assessee has submitted that the Assessing Officer has made an addition of ₹ 15,58,492/- to be the gross receipts of the assessee, without considering the fact that the said amount is part and parcel of the total receipts of ₹ 59,70,453/- received from M/s.Nagarjun Construction Co., against which TDS of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... books of accounts of the assessee were rejected, the income of the assessee was required to be estimated on some reasonable basis. The Assessing Officer has applied the Net Profit @10%, which is very reasonable and proper. He has relied upon the orders of the authorities below. 5.5. Having considered the rival submissions as well as the relevant material on record, it is noticed that the Assessing Officer has issued a notice u/s.133(6) of the Act to M/s.Nagarjun Construction Co., calling for information regarding total payments made to the assessee, such income has confirmed the payment vide two TDS certificates, one of ₹ 59,70,453/-, which was declared by the assessee in the books of accounts as well as in the return of income and the other one for ₹ 15,58,492/-. The Assessing Officer was of the view that the second payment of ₹ 15,58,492/- was not accounted and disclosed by the assessee and therefore the Assessing Officer has added the said amount to the gross receipts of the assessee. Further, there are some claims of fuel expenses, prior to commencement of the business which are not allowable deduction, therefore the Assessing Officer has held that the boo ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... to notice u/s.133(6) of the Act, the said company has furnished information of payment of ₹ 59,70,453/- as well as ₹ 15,58,492/- to the Assessing Officer. The Assessing Officer further noted that both the TDS certificates are dated 21-06- 2008. The assessee has not disputed the fact that he has reported only ₹ 59,70,453/- but contended that this amount of ₹ 15,58,492/- is part and parcel of ₹ 59,70,453/-. However, this is not the fact appearing from the certificates issued by M/s.Nagarjun Construction Co. Though the payment was not received by the assessee during the year under consideration, however, once the said payment was accrued and become due in the year under consideration, the actual receipt of the payment becomes irrelevant when the assessee is following the Mercantile System of accountancy. Since the assessee has not claimed the TDS credit against the said amount, therefore, the corresponding TDS credit shall be allowed to the assessee once the said amount is added to the gross receipt of the assessee. Hence, to the extent of the addition of ₹ 15,58,492/- in the gross receipts is confirmed. Ground Nos.4 6 are partly allowed. ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
