1977 (5) TMI 41

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....n the contract of construction of houses from the State Housing Board Coimbatore Unit and the contract for construction of houses and hospitals buildings from Salem Municipality. It field a return disclosing income of Rs. 64,149 for the assessment year under consideration. The ITO noticed that the assessee had received in all Rs. 11,82,592 and the net income of Rs. 50,420, disclosed worked out to about 4 per cent. He was of the view that the percentage was poor. He further noticed that most of the purchases were not supported by proper vouchers and the cooly payment of Rs. 497,948 was also not completely supported. He, therefore, rejected the books as unreliable and estimated the profit adopting a rate of 12 per cent. Thus, by his order dt.....

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....e of Rs. 3,37,000 had been supplied to the assessee by the Coimbatore unit of State Housing Board. She, therefore, confirmed the assessment. Hence, this appeal. 4. Sri R. Venkataraman, the learned counsel for the assessee strenuously contended before us that income returned should have been accepted and that no case has been made out for any addition. He urged that this was the second year of the business, the partnership having been formed in the previous year, relevant for the asst. yr. 1972-73. According to him, though the assessee had not maintained books properly for the accounting year ending 31st March, 1972, books have been maintained for the accounting year under consideration in a proper manner and should not have been rejected....