2014 (5) TMI 1026

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....ome from civil contract business. During the year under consideration, the assessee company has declared total sales of Rs. 8.89 crores yielding net profit at 2.49% as against total sales of Rs. 4.50 crores declared in last year on which net profit rate comes to 2.66%. The assessee produced books of account and other details before the AO. However, the AO noted certain discrepancies and mainly in the claim of wages. The AO found the net profit rate declared by the assessee at 2.49% very low. It was found that neither the wages have been paid fortnightly nor weekly. There is no site name of wages paid as per labour sheet. Only thumb impressions against receipts have been obtained of few persons. The wages paid are nearly 50% of the receipt. ....

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.... may be considered for the purpose of making addition. The ld. CIT(A), however, did not accept the contention of the assessee and dismissed the appeal of the assessee. 3. We have heard the ld. representatives of both the parties, perused the findings of authorities below and considered the material available on record. The ld. counsel for the assessee reiterated the submissions made before the authorities below and submitted that in preceding assessment year 2009-10, NP rate declared was 2.66% and in assessment year 2008-09, the net profit rate disclosed by the assessee was 3.05%. He has submitted that in case of rejection of books of account, history of the assessee may be considered for the purpose of estimating the income. He has reli....

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.... as under : "The assessee is a private limited company. It was found that it did not maintain accounts in a proper manner; they were maintained on loose sheets. Accordingly, they were rejected. Having rejected the accounts, the authorities made an estimate of the income on the basis of material available and the past assessment orders. In the circumstances, it cannot be suggested that the estimate made is a pure guess or that it is not based on relevant material. No question of law can be said to arise from the order of the Tribunal." He has submitted that though the assessee has agreed for applying net profit rate of 4%, which is also excessive as against history of the assessee, but he made the statement at bar that 4% net profit ra....