Appeal partly allowed for statistical purposes, case remanded for reassessment.

The appeal was partly allowed for statistical purposes. The Tribunal directed the Assessing Officer to examine the allowability of statutory deductions and consider relevant case laws. The issue of estimating profits at 15% was disapproved, and the case was remanded for reassessment based on fair and reasonable profit rates. The addition under section 69 was also allowed in favor of the assessee due to lack of nexus with the firm's profits.

---

---

Issues:
1. Rejection of books u/s.145 of the Act and addition of Rs. 21,79,036 not pressed
2. Estimation of net profits at Rs. 2,00,41,924 @15% of total contract receipts
3. Addition of Rs. 20,00,000 u/s.69 on account of unexplained introduction of capital by partner

Analysis:

Issue 1: Rejection of Books u/s.145 and Addition of Rs. 21,79,036
The appellant did not press this issue, leading to its dismissal as 'not pressed.' This decision was made after both parties were heard, and it was confirmed that the grounds related to this issue were not pursued.

Issue 2: Estimation of Net Profits at Rs. 2,00,41,924
The CIT(A) rejected the books of account under section 145 of the Act due to discrepancies in the profit and loss account. Consequently, the CIT(A) estimated the profits at 15% of the total contract receipts, resulting in an addition of Rs. 2,00,41,924. However, the Tribunal found this estimation unfair and unreasonable, citing a comparable case with a net profit rate of 6.25% as fair and reasonable. The Tribunal directed the AO to compute the profit using the 6.25% net profit rate, considering statutory deductions for remuneration and depreciation.

Issue 3: Addition of Rs. 20,00,000 u/s.69
The CIT(A) confirmed the addition of Rs. 20,00,000 under section 69 on account of unexplained capital introduction by the partner. However, the Tribunal deemed this decision unfair, emphasizing the need for consistency in taxing similar capital introductions. As there was no established nexus between the amount and the firm's profits, the Tribunal allowed this ground in favor of the assessee.

In conclusion, the appeal was partly allowed for statistical purposes. The Tribunal directed the AO to examine the allowability of statutory deductions and consider relevant case laws. The issue of estimating profits at 15% was disapproved, and the case was remanded for a reassessment based on fair and reasonable profit rates. The addition under section 69 was also allowed in favor of the assessee due to lack of nexus with the firm's profits.

---