TaxTMI 
TaxTMI 
2014 (1) TMI 1432
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....certificates were filed. The assessee estimated the profit @ 8% availing the benefit of presumptive taxation u/s 44AD. It is claimed that no books of account were maintained, hence audit report under section 44AB was not filed. The Assessing Officer did not believe the submissions of the assessee and observed that there was no reason and sufficient cause for not maintaining regular books of account even after the search operation carried out on the assessee group on 23.12.2002. He also recorded the statement under section 131 of the Income-tax Act, 1961 of one Shri Baljeet Singh Bakshi, partner of the assessee firm and the assessment was finalized under section 144 of the Act on 29.12.2008 by making the two additions, i.e. Rs.7,49,145/- was....
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....laries paid to partners by observing "that the same is disallow to cover up the possible leakages of revenue and for violation of provision of sec 44aa of IT Act". The addition / disallowance is being erroneous and untenable be kindly deleted. 4. That the several additions as made over and above return income by the Ld AO and confirmed by the Ld CIT(A) are unjust, unwarranted and untenable, which be kindly deleted. 5. That in any case but without prejudice to preceding grounds the total additions as made by the Ld AO and confirmed by the Ld CIT(A) are arbitrary and very excessive. 6. That the penal interest u/s 234-a/234-b/234-c and 234-d have been wrongly charged, which be kindly cancelled /held as not chargeable. 7. That the several o....
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....ed @ 8% on the total sales of the assessee then no addition can be made under section 68 or 69 of the Income-tax Act. Ld. AR also pleaded that these may be included in the turnover of the assessee and only profit element can be taxed as an income. We are unable to agree with the pleadings of the AR. Once these credits appeared in the bank account of the assessee it was on the assessee to explain the source of these credits. The assessee cannot be granted relief only on the basis that these may be refund of the securities that were pledged with the Nagar Nigam, Meerut time to time at the time of contracts assigned to the assessee. Since the assessee has not given any reasonable explanation with regard to credit entries in its bank account be....
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....duction by way of salary and remuneration etc. in case the assessee made a failure as provided under section 144. Similarly, the assessee also failed to prove other ingredients of section 184 before the Assessing Officer." 9. We have heard both the sides on this issue. The Assessing Officer made the addition by disallowing the amount of salary paid to the partners to cover up the possible leakages of revenue and for violation of provisions of section 44AA of the Act. The assessee's case was not covered by the provisions of section 44AD of the Act, hence Assessing Officer held that no deduction allowed to partner's salary from the estimated net profit @ 8% of the receipts. However, the CIT (A) has confirmed the addition of invoking the prov....