TaxTMI 
TaxTMI 
TaxTMI 
2013 (4) TMI 759
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....fter referred to as the "Tribunal"] in I.T.A. No. 304/LKW/2011 for the Assessment Year 2005-2006, whereby the Tribunal has dismissed the appeal. 3. Shorn off unnecessary details the facts of the case are as under : Pragati Engineering Corporation-appellant is a partnership firm and is engaged in the business of civil contractors in district Raibareli. During the Assessment Year 2005-2006, the appellant had received gross payment from various Government department to the tune of Rs. 1,33,76,545/-, which was audited by the Chartered Accountants on the basis of books of accounts. Thereafter, on 30.10.2005, appellant had filed its return of income for the Assessment Year 2005-2006, showing income of Rs. 4,43,630/-. In compliance to a notice ....
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....nds that books of accounts were kept in an open area in a jute bag. In these backgrounds, the appellant had filed a written submission dated 20.11.2007 before the Assessing Authority, stating therein that in the absence of the books of accounts, the assessee is agreeable for estimation of income and agreed for a net profit of 8% of the gross receipts. 5. On receipt of the said written submission dated 20.11.2007, the Assessing Authority observed that the turnover of the assessee was beyond the prescribed limit of Rs. 40,00,000/-, whereby he has to maintain book and, therefore, adoption of flat rate of 8% under Section 44AD of the Act is not permissible in law. Accordingly, the Assessing Authority, vide order dated 6.12.2007, while making a....
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....ppeal. Hence the instant appeal. 9. Sri Pradeep Agarwal, learned Counsel for the assessee/appellant submits that Section 44 AD was brought on the statute book only with an intention that in case of a civil contractor, who does not maintain books of accounts, then, he shall be assessed by applying a net rate of 8%. In the present case, though the books of accounts are maintained, the tax audit report was submitted but the Assessing Authority erred in not applying net rate of 8% under Section 44 AD of the Act as offered by the appellant. 10. Sri Agarwal further submits that while adjudicating the appeal, learned Commissioner of Income Tax (Appeal), has stated that appellant agreed to be assessed at the rate of 8% of net profit as against t....
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....e impugned order is liable to be set-aside. 12. Per contra, Sri Prashant Kumar, learned Counsel for the respondents submits that the tribunal after hearing the parties and going through the material on record has rightly dismissed the appeal of the assessee. While dismissing the appeal, the Tribunal has recorded findings of facts and laws relating to the present facts and circumstances of the case in detail. Thus, the appeal is liable to be dismissed. 13. We have heard learned Counsel for the parties and perused the records. 14. Section 44AD of the Act was inserted by Finance Act, 1994 w.e.f. 1.4.1994. Sub-section (1) of Section 44AD clearly provides that where an assessee is engaged in the business of civil construction or supply of lab....
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....nts. The Assessing Authority rejected the plea of the assessee on the grounds that the assessee failed to submit the books of accounts. It is not in dispute that accounts of the assessee was audited by the Chartered Accountant on the basis of books of accounts and on that basis, return of income was filed by the assessee, showing income as Rs. 4,43,630.00. It is also not in dispute that the assessment under Section 143 (3) of the Act was completed and the books was not rejected under Section 144 of the Act. Therefore, the auditors report can be relied upon by the Revenue authorities in the absence of the books of accounts in view of Jay Engineering Works (supra). 17. In Radhasoami Satsang v. CIT [1992] 193 ITR 321/60 Taxman 248 (SC), Sarda....