TaxTMI 
TaxTMI 
2022 (1) TMI 1025
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....t applying the net profit from the contract. The matter was decided by the Hon'ble Tribunal after considering all the facts. 5. That the order of the ld. AO has merged with the order of the Hon'ble Tribunal and as such the provisions of section 263 are not applicable. The order passed is illegal and bad in law. 2. Brief facts as culled out from the records are that the assessee is an individual engaged in the business of Civil Contractor. Income of Rs. 49,15,730/- declared in the e-return of income filed on 31.10.2015. Case selected for scrutiny through CASS due to reasons "Receipt u/s 194C and 194J( As per 26AS) are more than the receipts shown in ITR5/5/6". Notices u/s 143(2) & 142(1) of the Act were served upon the assessee. It was admitted before Ld. AO that books of account are not maintained, statutory requirement of getting the books of account audited u/s 44AB of the Act not complied. As per the 26AS the contractual receipts stood at Rs. 6,96,81,297/- whereas the turnover declared by the assessee was Rs. 8,08,21,143/-. Assessee declared net profit @ 5% on the total turnover at Rs. 40,39,907/-. Ld. AO finalized the assessment estimating net profit @10% on....
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....e order, I deem it proper to give you're an opportunity of being heard in the matter. 4. In compliance to the above show cause notice u/s 263 of the Act assessee filed following written submissions through email on 12.03.2020: 1. The assessee has paid interest of Rs. 10,08,020/- to Bank of India on CC Limit. The CC Limit is used for business purpose. The assessee has earned interest of Rs. 9,97,465/- on FDRs. The assessee has made FDRs for providing bank guarantee and as security deposit to the government departments for which contract work is undertaken. Thus the interest on FDs is in nature of business income. The assessee has shown income on percentage basis. The assessee has not claimed deduction for interest paid separately. Similarly income is also not shown separately. If interest income is considered separately then deduction of interest paid should be allowed from interest income. 2. The plots purchased are not for business purpose but are fixed assets of assessee. This is prove from the fact that the income from six plots sold has been shown under the head capital gain. 3. If the registration expenses and stamp duty are paid by seller then it....
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....f Rs. 4,79,500/- the difference in guidelines value for plots purchased. It is an admitted fact at the end of assessee that he has not maintained books of account even when the turnover declared is at Rs. 8,08,21,143/- and no audit u/s 44AB of the Act could be carried out. In absence of books of account Ld. Assessing Officer estimated the income from civil construction business @ 10% at Rs. 80,82,114/-. We further find that notice u/s 263 of the Act was issued by ld. Pr. CIT, Bhopal for the following two issues: 1. The assessee received interest from the Bank of India of Rs. 9,97,465/- and Rs. 45,970/- from shri Lokesh Narang. Tax deducted at source on such interest was duly claimed in the return of income. The assessee has not considered such interest income in the total turnover nor under the head "income from other sources". The same should be added back to the total income. 2(a). The assessee had purchased 51 residential developed plots on 12.09.2014 from M/s Shri Atharva Devcon Pvt. Ltd. for Rs. 2,27,00,000/- and registration & stamp duty expenses of Rs. 18,42,985/-. Furtehr the assesse paid Rs. 45,40,000/- in cash to the seller between 02.09.2014 to 31.03.20....
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....brief details about tax deducted on sale of property but not claimed in the income tax return. In the reply assessee stated that "during the year the assesse has purchased 51 plots at Mahamangal City and Out of the plot purchased the assessee has sold six plots. List of plots purchase and sale along with calculation of capital gain is attached here with. The copy of registries of sale is also attached. The source of investment is ?" 10.1 From the above reply it is loud and clear that firstly the assessee has not furnished complete details of plots purchased, and secondly there was no information about the source of investment. Even the Ld. Assessing Officer has not raised any query about the details of plots purchased, purchase consideration paid, fair market value of the property/valuation as per stamp valuation authority, whether they are part of business transaction and most importantly source of investment to purchase these properties. The information called by the ld. Assessing Officer as well as the assessment order are silent on this issue. It is also noteworthy that in the computation of income assessee has shown income from house property, profit and gain of business, i....