2004 (3) TMI 366

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....Rs. 63,227, after reducing the depreciation of Rs. 48,660. The rate of net profit came to 6.64 per cent after depreciation and 12.27 per cent before depreciation. The assessee claimed expenses at Rs. 1,05,180 in cement and Rs. 50,771 on account of soiling/Kankeri Tudai/water expenses. The AO observed that the assessee had shown closing stock of cement at Rs. 45,000 and was not maintaining proper voucher in respect of expenses claimed. He, therefore, disallowed Rs. 60,180 (Rs. 1,05,180 - Rs. 45,000) out of cement account and whole of the claim amounting to Rs. 50,771 under soiling, Kankari Tudai/water charges was disallowed. 4. The assessee carried the matter to the learned CIT(A) and submitted that the net profit declared by the assessee....

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....er assessees engaged in similar type of business. The assessee had shown net profit rate before depreciation at 12.27 per cent in the civil contract works. This profit appears to be reasonable particularly when the AO has not doubted the same. We also find substance in the submission of the learned counsel for the assessee that if addition made by the AO is considered, the net profit would be at an exorbitant figure, which is not possible in such type of business. Considering the totality of the facts, we do not see any valid ground to interfere with the order of the learned CIT(A). 7. The next issue agitated by the Department relates to deletion of addition of Rs. 20,000. The AO found that there was a deposit of Rs. 20,000 in the partne....