TaxTMI 
TaxTMI 
2021 (7) TMI 1243
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....f the Income Tax Act, 1961 was conducted on 12.11.2013 on the premises of the assessee comprising Eminent and Dynamic Group of cases in Agra & Delhi. The assessee is one of the group companies. In response to the notice under section 153A of the I.T. Act, 1961 issued on 15.07.2015, the assessee did not file its return of income. However, on 17.12.2015, the A.R. of the Assessee filed a copy of the income tax return stating that the same should be treated as return filed in response to notice under section 153A of the I.T. Act 1961. Subsequently, notice under section 143(2) of the I.T. Act was issued on 17.12.2015 under presumption that the assessee has e-filed its return of income. However, it was noticed that the assessee has not e-filed its return which is mandatory for the corporate assessees. However, the assessee did not e-file its return of income in response to notice under section 153 A of the Act and the date of compliance was fixed on 31.12.2015. Simultaneously, notices under section 153A of I.T. Act for the years 2008- 2009 to 2013-2014 and notice under section 142(1) for the Assessment year 2014-2015 were issued to the assessee. In response to the notices under sectio....
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....016 and further till 31.08.2016. As per the A.O. the decision of the Court is still awaited, neither there is any information from the side of assessee of any stay on the pending assessment by the Hon'ble Court. Therefore, since the assessment is getting time barred, the A.O. proceeded to complete the assessment. After considering the various submissions filed by the assessee from time to time, the A.O. completed the assessment by adopting the net profit rate of 15% on the turnover of Rs. 9,56,33,536/- and determined the total income of the assessee at Rs. 1,43,45,030/- for A.Y. 2008-2009. 2.3. For other assessment years also, the A.O. determined the income by applying the rate of 15% on the total turnover which are as under : For the A.Y. 2010-2011 Rs. 1,22,61,246/- For the A.Y. 2011-2012 Rs. 2,53,46,926/- For the A.Y. 2012-2013 Rs. 5,86,40,100/- For the A.Y. 2013-2014 Rs. 6,00,06,235/- 2.4. Before the Ld. CIT(A), apart from challenging the addition on merit, the assessee also challenged the validity of the assessment order being barred by limitation on the ground that the time limit for completion of the assessment is to be reckoned with reference to....
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....of the case, undersigned is of the view that net profit adopted by the AO at 15% is on the higher side and is not based on any comparable cases. Undersigned is of the view that adoption of net profit at 8% of the gross turnover would meet the end of justice especially considering the intention of the legislature enshrined in provision of section 44AD of the Act wherein it is mentioned that in the business of civil construction profit would be computed at 8% of the gross turnover of the business. In the present case appellant failed to produce the audit report u/s 142(2A) of the Act. Books of account of the appellant cannot be relied in absence of supporting evidences and the same is rejected u/s 145 of the Act. Even though turnover of the business of appellant is more than the turnover mentioned u/s 44AD of the Act legislative intention to rejected u/s 145 of the Act. Even though turnover of the business of appellant is more than the turnover mentioned u/s 44AD of the Act legislative intention to tax at 8% on gross receipts of the business involved in civil construction can be safely applied to the case of the appellant. Hence, AO is directed to work out the net profit @ 8% on gros....
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....een made either on facts or in law. 6. BECAUSE the CIT(A) on a due consideration of the facts and circumstances of the case, particularly that a) the financial results disclosed by the appellant stood fully supported by audited statement of accounts, which were subjected to twin audits, one statutory audit under the Companies Act and another tax audit under the Income Tax Act; b) there was no qualification added in the audit reports about unverifiability of any expenditure/ receipt; c) the turnover disclosed by the said very audited statement of accounts was accepted as such; and d) there was not even a whisper about unverifiability of expenditure as stood debited in the Profit & Loss Account; the financial results declared by the appellant were liable to be accepted, without there being any rejection by invoking the provision of section 145(3) of the Act. 7. BECAUSE estimate of net profit @ 8% of the turnover (as against the profit disclosed by the appellant) as has been sustained by the "CIT(A)", is wholly erroneous without any basis and the same is not sustainable either on facts or in law. 8. BECAUSE in any case the....
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....ys + 60 days expires on 21.08.2016. However, the A.O. has passed the assessment order on 28.10.2016 which is beyond the period of limitation. He submitted that there was no stay from the Hon'ble Allahabad High Court against the writ petition filed by the assessee, which fact is also brought on record by the A.O. himself. Therefore, merely because the assessee has made a request to the Auditor to withhold the Audit till the decision of the Hon'ble High Court, cannot be held against the assessee, in absence of any stay by the Hon'ble High Court. 3.3. Referring to the Order of the Ld. CIT(A), he submitted that the Ld. CIT(A) has wrongly interpreted the provisions of Section 153B read with Explanation-(b) stating that the time period starting with the statutory filing of writ petition and ending with the date of disposal of the writ petition has to be excluded for computing the period of limitation. Learned Counsel for the Assessee, drew the attention of the Bench to the relevant portion of the Explanation to provisions of Section 153B which has been relied on by the Ld. CIT(A) and has been reproduced in his order as under : "Explanation.-In computing the period of limit....
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....T for conduct of special audit under section 142(2A) and has requested the Special Auditor to withhold the Audit Report till the decision of the Court, therefore, the assessee now cannot take a plea that the order passed by the A.O. is barred by limitation. She submitted that the Ld. CIT(A) has correctly decided the issue against the assessee and, therefore, such order being in accordance with Law should be upheld. So far as the merits of the case is concerned, the Ld. CIT(A) also relied on the Order of the A.O. and submitted that since the Ld. CIT(A) has already given substantial relief to the assessee by reducing the net profit rate from 15% to 8%, therefore, the assessee should not have any grievance. 5. We have heard the rival arguments made by both the sides, perused the orders of the A.O. and the Ld. CIT(A) and the paper book filed on behalf of the assessee. We have also gone through the various decisions cited before us. We find the A.O. in the instant case has communicated to the assessee vide letter Dated 22.03.2016 [Pages 84-89 of the paper book] regarding approval given by Pr.CIT, Central, Kanpur for getting its accounts audited by M/s D.S. Sinha & Co, Kanpur withi....