1974 (12) TMI 6

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....ncome-tax Act, 1961, we are concerned with the assessment years 1964-65 and 1965-66 for which the relevant accounting years are the years ending on 31st March, 1964, and 31st March, 1965, respectively. The assessee is an individual. He carries on business of executing contracts for the Executive Engineer, North Bengal Construction Division, and the Executive Engineer, Torsa Bridge Construction. Th....

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....he Government had supplied cement, iron rods, etc., costing Rs. 1,44,408 and Rs. 1,99,383 in the respective two years under consideration. According to the assessee, the cost of the materials should have been deducted from the gross amounts of bills for the purpose of determining the net profit earned by the assessee. The Appellate Assistant Commissioner was of the view that the assessee did earn ....

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....e Tribunal was justified in holding that a net profit rate as applied by the departmental authorities on the gross amounts of bills without deducting the cost of materials supplied by the Government was legally justified for the assessment years 1964-65 and 1965-66?" Counsel for the assessee contended before us that there could not be any proposition of law that in a case of materials supplied ....

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....als by the Government to be made or at what price. Furthermore, the gross profit has been computed on the total gross bill of the assessee. In the aforesaid background the Tribunal had come to the conclusion that the assessee, though tendered the contract as a whole, it must have included the cost of materials which were supplied by the Government as an element of profit in respect of cost of mate....