TaxTMI 
TaxTMI 
2015 (1) TMI 303
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....Rs. 19,17,08,176 in stead of Rs. 12,05,38,441 as disclosed by assessee and ground No. 3 is against estimating the profit at 8.5%. 4. Briefly the facts are, assessee a partnership firm is engaged in executing works contract. For the AY under dispute, assessee filed its return of income on 15/10/2010 declaring total income of Rs. 57,76,751. During the scrutiny assessment proceeding as noted by AO in the assessment order, in spite of several opportunities being granted, assessee failed to produce books of account/bills and vouchers on the plea that they were misplaced during the course of shifting of office records from work site. Assessee further requested the AO to complete the assessment by estimating the income at 8.5% of the turnover. ....
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.... M/s. Vishwa Infrastructures and Services Pvt. Ltd., which cannot be accepted at the face value. (ii) Secondly, it is not known as to why M/s. Vishwa Infrastructures and Services Pvt. Ltd. will create a provision entry of Rs. 3,27,26,881/ - & Rs. 3,38,52,748/- in its books of account and at the same time also deducted TDS @ 2% on the said entries. The reason for making this provision entry and later reversing it in its books of account has not been substantiated. (iii)The assessee has not produced its books of account, so that the claim made by the assessee can be verified. (iv) Further, a search operation u] s 132 of the LT.Act has already been conducted in M/s. Vishwa group of companies and its related persons on 07.08.2012 by th....
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....stained the view of the AO by holding as under: "5.7 The facts of the case further reveal that the appellant was following mercantile method of accounting and it has not revealed the reasons for holding back the amounts of Rs. 8,16,92,576/- by passing the entries in the form of provisions, that too where the TDS was effected on such amounts. This information could not be verified with the principal contractor, as it appears that there was no clarification or confirmation on the said issue. Hence, in the absence of reasonable explanation for not disclosing the said amounts for computing the gains of business, in the year of accrual of such amounts, i have no hesitation to hold that the amount of Rs. 8,16,92,576/- representing the differen....
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....g to Rs. 3,27,26,881 and Rs. 3,38,52,748 relating to the work of old city sewerage Zone No.2 and provision for an amount of Rs. 1,51,12,951 in respect of work relating to old city sewerage Zone No. 1. It was submitted by the learned AR that these are only in the nature of provision made in the books of principal contractor and they do not represent either bills raised or bills received by assessee during the relevant FY. In this context, learned AR drew our attention to the reconciliation statement at page 24 of assessee's paper book and assessee's ledger account in the books of M/s Vishwa Infrastructures and Services Pvt. Ltd., a copy of which is placed at pages 44 & 45 of assessee's paper book. Learned AR submitted that these ....
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....tablished. He further submitted that in absence of books of account and other information produced by M/s Vishwa Infrastructures and Services Pvt. Ltd., the ledger account produced by assessee claiming it to be in the books of account of M/s Vishwa Infrastructures and Services Pvt. Ltd. cannot be accepted at face value. Learned DR submitted that as there is total lack of information either by assessee or by M/s Vishwa Infrastructures and Services Pvt. Ltd. with regard to actual contract receipts, AO has rightly adopted the figure as mentioned in Form 26AS statement. 7. We have considered the submissions of the parties and perused the orders of the revenue authorities as well as other materials on record. There cannot be dispute with the ....
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....hat the amount received from the entire contract works has been shown in the AY 2010-11 and 2011-12. It was submitted by the learned AR that in AY 2011-12, assessee has disclosed gross contract receipts of Rs. 20,54,64,464, which also includes the differential amount of Rs. 8,16,92,576. If the aforesaid claim of assessee is found to be correct, then, there will be no justification in including the amount of Rs. 8,16,92,576 in the contract receipts for the impugned AY as such inclusion would result in taxing the same income twice. Further, it transpires from materials on record that a search and seizure operation was conducted in case of M/s Vishwa Infrastructures and Services Pvt. Ltd. Therefore, it will not be difficult to cross verify cor....