TaxTMI 
TaxTMI 
2016 (2) TMI 190
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....count of interest income. 4. That the learned CIT (Appeals) has erred in confirming the addition of Rs. 15,228/- made by the learned assessing officer on account of taxi plying, on an estimate basis. ITA No. 138/JP/2013 (A.Y. 2009-10) : 1. That the leaned CIT (Appeals) has erred in confirming the rejection of books of account by the learned assessing officer and thereby applying the provisions of section 145(3). 2. That the learned CIT (Appeals) has erred in confirming the addition of Rs. 16,47,466/- made by the learned assessing officer, by applying a net profit rate of 9% subject to depreciation. 3. That the learned CIT (Appeals) has erred in confirming the separate addition of Rs. 12,24,814/- made by the learned assessing officer on account of interest income. 4. That the learned CIT (Appeals) has erred in confirming the separate addition of Rs. 26,232/- made by the learned assessing officer on account of non business use of cars. 2. Brief facts of the case are that the assessee is a civil contractor, derives income from construction work awarded by PWD and other government departments, and also income from interest. The a....
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.... 4. Now the assessee is in appeal before us. 4.1. The ld. A/R for the assessee has submitted that the authorities below have decided the issue of N.P. rate of 9% despite the fact that there is increase in the profit and the turnover of the assessee. It was also contended that the books of account have been wrongly rejected by the authorities below, and he has submitted that the assessee has not produced the books of account as were available with him as the assessee has suffered from injuries. Two affidavits were also filed to support the case of the assessee. 4.2. The ld. D/R for the revenue has confronted the argument of the ld. A/R and has submitted that despite various opportunities, the books of accounts have not been produced. He has drawn our attention to the following para at page 9 in the order of ld. CIT (A) :- " The compliance of notice u/s142(1) has been really poor. What is more, the assessee has not been able to produce any bills/vouchers which means that his claim regarding expenses can not be verified. Cash Book has not been produced and Stock Register has also not been produced. Thus, the stock, cash, exp. etc. cannot be verified. The claim of credi....
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....so. Therefore, the ground nos. 1 & 2 are decided against the assessee and in favour of the revenue. In our view, the judgments referred by the assessee i.e. Addl. CIT vs. Jay Engineering Works Ltd. (1978) 113 ITR 389 (Del), DCiT vs. Setalvad Brothers (2004) 90 TTJ (Ahd.) 193, CIT vs. American Consulting Corporation (1980) 123 ITR 513 (Ori.), Seth Nathuram Munalal vs. CIT (1954) 25 ITR 216 (Nag.), CIT vs. Gupta, K.N. Construction Co. (2015) 371 ITR 325 (Raj.), CIT vs. M/s. Vaibhav Gems Ltd. (2014 52 Tax World 159 (Raj.), CIT vs. Subodh Gupta (Del) ITA 80/2014, Harban Lal Sethi vs. ACIT (2003) 30 TW 82 etc. are not applicable in the present case on the facts and circumstances. In the present case, the admission of the assessee which has prompted the AO to determine the NP rate and the AO has accepted the NP rate. In none of the judgments referred by ld. A/R for the assessee, the court have concerned with the admission of the assessee, in our view the judgment referred by the assessee are not applicable. 5. Ground no. 3 in both the assessment years relates to separate addition of Rs. 3,53,932/- and Rs. 12,24,814/- on account of interest income from FDRs. 5.1. The AO made the add....
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....bserving that " Lastly, the assessee has also declared the gross receipts of Rs. 95,174/- from car hiring. In view of no documents regarding this business, the income from taxi plying is treated @ 25% on fair estimate basis. Out of this, 9% has already been assessed as a part of gross contractual receipts. Therefore, rest 16% is being added to assessee's income under this head. Accordingly, further addition of Rs. 15,228/- (16% to Rs. 95,174/-) is hereby made to assessee's income. 7.2. The ld. CIT (A) has confirmed the addition by observing that " As assessee has produced no supporting document, the action of Assessing Officer was considered fair and reasonable." 8. Now the assessee is before us. 8.1. The ld. A/R for the assessee has argued that AO has arbitrarily estimated the income from car hiring @ 25%, without giving any reason in support of the estimate. He submitted that when the books of account are rejected, revenue cannot rely on the same set of books and disallow specific items of expenditure. The estimate of income from car hiring made by the AO is based on surmises and conjectures and is not justified on any legally sustainable foundation. Therefore, he prayed....