AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2016 (6) TMI 781
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....that the books of account produced by the assessee at the time of making assessment should have been examined and income could have been estimated by the Assessing Officer after pointing out the defects and, therefore, rejection of the books of account. 4. That without prejudice to the above the income estimated at eight per cent. by the Assessing Officer and sustained by the Commissioner of Income-tax (Appeals) is highly excessive as per the facts of the case. 5. That the Commissioner of Income-tax (Appeals) was not justified in upholding the action of the Assessing Officer in estimating the agricultural income at Rs. 35,34,722 while sustaining this addition the Commissioner of Income-tax (Appeals) failed to appreciate and dispose of submissions made by the assessee." 2. The first issue, comprising ground Nos. 1 to 4, is the assessee's challenge to the action of the learned Commissioner of Income-tax (Appeals) in sustaining the estimation of profit at eight per cent. on the assessee's contractual receipts under the provisions of section 44AD of the Income- tax Act, 1961. 3. The assessee is a civil contractor. He filed his return of income for the year under considera....
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....l contract receipts. 5. Before this Bench, the learned counsel for the assessee has contended that the learned Commissioner of Income-tax (Appeals), while wrongly upholding the Assessing Officer's action in estimating the net profit at eight per cent. on the contract receipts of the assessee under the provisions of section 44AD of the Act, the learned Commissioner of Income-tax (Appeals) failed to appreciate that the books of account produced by the assessee before the Assessing Officer during assessment proceedings had not been examined and the income had wrongly been estimated by the Assessing Officer without pointing out any defect in the books and rejecting them. 6. On the other hand, the learned Departmental representative has strongly relied on the impugned order. It has been contended that the books have to be prepared before filing of the return and not after detection of fault by the Department. 7. Having heard the rival contentions in the light of the material available on record, it is seen that the assessee is a civil sub-contractor, carrying out the work of laying foundations for bridges. Before the Assessing Officer, in the assessment proceedings, the assessee ....
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....esh in accordance with law, on duly taking into consideration the books of account produced by the assessee by affording adequate opportunity to the assessee to support his case. Ground Nos. 1 to 4 are, thus, treated as accepted for statistical purposes. 10. According to ground No. 5, the learned Commissioner of Income-tax (Appeals) was not justified in upholding the Assessing Officer's action in estimating the agricultural income of the assessee at Rs. 35,34,722 without disposing of the submissions made by the assessee. 11. As per the Assessing Officer, it was found that the assessee was in receipt of agricultural income amounting to Rs. 34,30,758 during the year, which was not shown by the assessee in his return of income. The Assessing Officer held that this agricultural income had been earned by the assessee during the year and it had to be taxed as per the provisions of the Act. 12. Before the learned Commissioner of Income-tax (Appeals), the assessee contended that the Assessing Officer had erred in working out the agricultural income at Rs. 34,30,758 from the copies of J forms submitted by the assessee and he had failed to appreciate that the entire sale proceeds of t....
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....mmissioner of Income-tax (Appeals), however, upheld the Assessing Officer's action in assessing the assessee's agricultural income at Rs. 34,30,758. For doing so, he observed that the assessee had himself admitted that he had earned agricultural income (net of expenses) at Rs. 25,000 - 30,000 per acre, i.e., Rs. 27,500 per annum, on an average ; that the assessee had also himself admitted that the agricultural income was to the extent of 60 per cent. of the gross agriculture receipts ; that this meant that the assessee had earned gross agricultural income at Rs. 68,750 per annum, which further meant that the gross agriculture income of the assessee from 110 acres of land should have been Rs. 75,62,500 (Rs. 68,750 x 110) and not Rs. 35,34,722, in respect of which, J forms had been submitted ; and that thus, it was very clear that the assessee had not submitted all the J-forms during the assessment proceedings. 15. In this regard, the learned counsel for the assessee has submitted that the learned Commissioner of Income-tax (Appeals) has clearly erred in upholding the action of the Assessing Officer since the specific written submissions filed before the learned Commissioner....