TaxTMI 
TaxTMI 
2011 (12) TMI 574
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....ed the following grounds before us:- "1. The CIT (A) erred in confirming the action of the assessing officer in resorting to estimation of income on the entire receipts of Rs. 247,38,48,963 without considering the fact that the appellant received commission by giving the contract to the extent of Rs. 105,63,81,791 on which commission was admitted in the return of income filed. 2. The CIT (A) ought to have directed that the estimation is to be made only in respect of the contracts undertaken by the appellant herein and not given on sub contract for which the appellant received only commission. 3. The CIT (A) erred in confirming the addition made of Rs. 81,15,346/- being machinery hire charges received without considering the fact th....
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....ting the income, the assessing officer made the following additions:- (a) The assessing officer estimated the income at 12.5% of the gross contract receipts at Rs. 247,38,48,963. (b) He allowed depreciation but disallowed the excess depreciation claimed of Rs. 40,65,848/- and added separately an amount of Rs. 2,02,70,000/- being the amount declared during the course of survey. (c) The assessing officer added other income of Rs. 2,03,37,456/- (d) He disallowed the claim of the appellant towards payment made to the sub contractor Sri P. Ramachandra Reddy Rs. 1,33,81,171/- (e) He deducted the amount disallowed by applying the provisions of sec.40(a)(ia) for the immediately preceding year of Rs. 2,01,91,542. (f) He did not all....
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....8,824/- and addition on account of sale proceeds of scrap at R.80,570/-were upheld and the addition of Rs. 2,02,17,000/- returned during the course of survey was confirmed. Now, the assessee is in appeal before us with regard to the estimation of income at 8% on the entire gross receipts of Rs. 2,47,38,48,963/-. The assessee is also on appeal before us with regard to the confirmation of addition of Rs. 81,15,346/- being machinery hire charges received and also the assessee is aggrieved against the addition of Rs. 2,20,70,000/- which has been offered during the course of survey operation and even after rejecting the books of account, the same amounts to double taxation. 6. The assessee also raised the additional ground before us which rea....
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....f commission received on subcontract has to be considered as income of the assessee separately. The contention of the assessee herein is that the amount of commission on this contract is already offered for taxation and the same has to be considered as income received from subcontract. If the assessee has already offered to tax the amount of commission on subcontract the same has to be considered as income on subcontract. Alternatively, the income from sub-contract has to be estimated as per the Tribunal decision in the case of Teja Constructions vs. ACIT, 129 TTJ (Hyd)(UO) 57 held as follows: " ... This is, because, when the assessee gives contract to the other parties on sub contract, the assessee cannot keep the same percentage of pro....
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....urned income. The assessee originally declared income vide return of income dated 23.11.2007 at Rs. 18,97,47,777. Later being there was a survey, the assessee offered additional income of Rs. 2,02,20,000. This addition was confirmed by the CIT(A) even after not accepting the returned income. In our opinion, when the returned income of the assessee was not accepted and the lower authorities estimated the income even after the assessee offered the additional income to fill up the discrepancies sustaining of additional income offered by the assessee as addition is not proper. However, we make it clear that the final income so estimated while passing the giving effect order to this order cannot go below the total income returned plus the add....