TaxTMI 
TaxTMI 
2012 (5) TMI 304
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....bill dated 31.03.2004. These bills and the amount has been disclosed by the assessee as his gross receipts in the relevant year under appeal. Hence, it can not be taken as work-in-progress and this already taken as income by he assessee in its profit and loss account. The materials purchased after 27.03.2004 and before 31.03.2004 amounting to Rs.5,55,039/- which was considered to be utilised for the purposes of work-in-progress was also withdrew in the income declared by the assessee in its profit and loss account. 4. The further contention of the assesee before us is that the assessee is in the business of a Civil Contractor. That includes Feeder Canal Division and Jangipur Barrage Division of the Farakka Barrage Project and the work undertaken by the assesee was for the embankment of the river bank bed also of repairing the barrage under the Farakka Barrage Project. The assessee consistently following the accounting practice followed in such contract work. By this method for all the projects including the on-going projects, the gross receipts, received by the assessee against the said contracts are fully credited to the profit and loss account as the income of the assesse....
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.... Here, in this case under appeal, the accounting policy consistently followed by the assessee wherein all the income and expenses were wholly accounted for and offered as such in the profit and loss account as and when it was received or incurred, there arises no work-in-progress with relation to expenses incurred on the on-going projects as the whole is offered as income/expenses. Here, the Ld. Counsel made a statement at Bar that no other work-in-progress is pending and what is shown in the books are the same that all the income and expenses were wholly accounted for and offered as such and nothing new as no new work-in-progress exists. This, the Assessing Officer should verify. Hence, we set aside the order of the Ld. CIT(A) and direct the Assessing Officer to verify and if it is found correct the Assessing Officer is directed to allow the same. It is needless to say that the Assessing Officer should afford opportunity to the assessee. 9. Coming to the 2nd ground, this addition is also under section 69 of the Act to the tune of Rs.13,85,600/-. The additional facts relevant to decide the issues is:- 9.1 The assessee has to make extensive purchase of construction m....
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....Mr. S. Das by the assessee on 09.06.2008 wherein Mr. S. Das admitted that the earlier statement is incorrect. In the cross examination Mr. S. Das admitted that he was acting as agent for the assessee whereby he procured the said supply of wires on credit from one Shri Pintu Jain on his own personal guarantee. He has further confirmed that the bills for the amount of Rs.13,85,600/- (copy is made available before us in assessee's paper book at pages 42 to 48) were also issued and sent by Shri Pintu Jain to Mr. S. Das, who himself on his own account, cleared the same, however, vide cash withdrawals of Rs.4,00,000/- and Rs.7,00,000/- made from his account out of the sum transferred by the assessee from his bank account, UCO Bank, Farakka Branch to the bank account of Mr. S. Das. This against the purchases of Rs.13,85,000/-, a payment of Rs.11,00,000/- was duly cleared by Mr. S. Das and the balance of Rs.2,85,600/- being the outstanding amount was duly shown as credits in the balance sheet of the assessee. The Ld. Counsel concluded that his explanation was rejected by the Department without considering the same. Hence, he prayed for deletion of addition under section 69 of the Act. &nbs....
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....ement that they went on to misnomer that the bills contains the name of Mr. S. Das but they failed to note the continuation entry as available at assessee's paper book pages 42 to 48 which supports the case of the assessee that the money went from the assessee's bank to Mr. S. Das account and the purchase is for the purpose of procuring assessee's busuiness and Mr. S. Das only acted as commission agent for the purpose of procuring black wires. These wires are required for the purpose of making the cage for the boulders so that the boulders do not roll into the river. For, this black wire raw material is one of the most important material and for the execution of the project and being an integral part of the project. The project can not proceed and completed without the said purchase. Ld. Counsel reliance on the decision of I.T.A.T., Agra Bench in the case of Saraf Gramodyog Sansthan vs. ITO and vice-versa reported in 298 ITR (AT) 348 (Agra), decision of Hon'ble Madhya Pradesh High Court in the case of Sumerchand Jain vs. CIT 292 ITR 241 (MP), decision of Hon'ble Punjab and Haryana High Court in the case if CIT vs. Leader Valves (P) Ltd. 285 ITR 435 (PandH) and the decision of Hon'b....