2022 (11) TMI 215

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....wa s returning 50 to 60% of the said higher billed amount to M/s. Serajuddin & Co., in cash, the Assessing Officer completed the assessment by adopting the turnover of the assessee as adopted on M/s. Serajuddin & Co., and granting the assessee a reduction of 30% towards expenses. The balance 70% of the turnover was treated as the income of the assessee and out of the said 70%, 50% to 60% of the total receipts was protectively assessed in the hands of the assessee and substantially in the hands of M/s. Serajuddin & Co. The balance was treated as substantive income of the assessee. It was the submission that the ld CIT(A) in para 5.2 of his order estimated the income of the assessee at 10% of the total receipts of the assessee from M/s. Seraj....

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....ining any computerized account on behalf of his client. Thus neither any books of account nor any vouchers for various expenses were found at the time of search at the premises of Shri Dillip Kumar Nayak.   iv.) During the course of search, the statement of Shri Dillip Kumar Nayak recorded on oath has been reproduced by the A.O in para-3.4 on pages-5 to 7 of the assessment order. It is obvious that major expenses were incurred on labour and wages. It was baffling to note that as against alleged expenses of Rs.1.27 crores, not a single voucher was found at the premises of the assessee or his Chartered Accountant namely Shri Naresh Kumar Agarwal. The number of labourers employed by the assessee in the mines was about 100 as per documen....

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..... Another seized document (page-6 of DKN-16) shows the amount returned to M/s. Serajuddin & Co. firm in the months of January and February, 2008. Shri Dillip Kumar Nayak has carried out raising work in respect of 730.32 MT of lumps, 18.95 MT of lumps and 6462.63 MT of fines. The billing rate is Rs.650/- per MT for lumps and Rs.205/- per MT for fines in January, 2008. The actual rate was Rs.380/- per MT for lumps and Rs.105/- for fines. On the right side of receipt of excess monies in cash from the contractors. Such cash received from the contractors was also allocated among partners and they had shared the gains.   Thus the order of the A.O. should be restored and that of the CIT(A) be reversed."   5. Ld CIT DR submitted that a....

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....at no books of accounts and vouchers have been maintained by the assessee, which is evident from the fact that the search did not bring out any books of account. However, in the assessment order, the AO refers to profit and loss account in his order. How this profit and loss account has been prepared is not ascertainable. Thus, clearly, the AO had no details with him except the turnover of the assessee, which has also been extracted from the books of account of M/s. Serajuddin & Co. This being so, a perusal of the order of the ld CIT(A) clearly shows that he has taken into consideration all the issues to come to the conclusion in paras 5.1 & 5.2 of his order that the estimation of income of the assessee is the best method to determine the i....