TaxTMI 
TaxTMI 
2013 (6) TMI 948
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....eturn, thus, erred in granting relief of Rs. 56,76,627/- out of the total addition of Rs. 70,30,138/- by estimating the profit at 8% of the total turnover which is highly excessive and further erred in granting direction to add interest income of Rs.1,65,114/- separately. 2. During the course of hearing, the Bench raised a query whether any appeal has been filed by the department challenging the part relief granted by the CIT(A). The learned Senior DR as well as the learned counsel for the assessee contended that no appeal has been filed by the department, therefore, on the basis of the assurance from both the sides, we proceed to dispose of this appeal of the assessee. 3. During hearing of this appeal, we have heard Shri H.P. Verma a....
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....vertheless it is found that the amount of disallowances made by the A.O. is not fair and reasonable. It is well settled that in cases where books of accounts are rejected the estimation of profit should be made on fair and reasonable basis. The appellant has executed contract for Govt. departments. In case of execution of work order for the Govt. departments the bills of contractors are cleared after certification of work executed. Since the work has been executed it logically follows that purchases had been done and operational and expenses like wages, salary, insurance and other expenses are indeed incurred. It is well settled that in case of rejection of books of account profit should be estimated on the basis of material available on re....
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....9,400/-. The assessment was completed at the income of Rs. 89,69,540/- and thus addition of Rs.70,30,140/- was made which is summarised as under :- S. No. Particulars Amount Rs. 1 Disallowance 20% out of total purchases of Rs. 2,12,62,026/- 42,52,405 2 Disallowance 50% out of salary of Rs. 4,95,600 2,47,800/- 3 Disallowance @ 100% out of insurance ofRs. 32,385/- 32,385/- 4 Disallowance @ 20% out of other expenses of Rs.1,24,87,743/- 24,97,548/- Total 70,30,138/- The controversy in brief is that during the year under consideration the assessee showed total turnover of Rs. 4,03,47,460/- resulting into gross profit of Rs. 46,87,520/- which is 11.37% of the turnover whereas the ass....
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....ere also not produced and thus the additions were made. As mentioned earlier, the assessee is a civil contractor and normally in the absence of books of accounts, even as per the provisions of section 44AD of the Act, notwithstanding anything to the contrary, contained in sections 28 to 43C of the Act, 8% of the total turnover or gross receipts of the assessee shall be deemed to be profits and gains of such business. Admittedly, the assessee did not produce the necessary details before the Assessing Officer, therefore, application of 8% of net profit of the total turnover is quite justified. So far as the contention of the learned counsel for the assessee that for the A.Y. 2008-09 also the assessee did not produce the necessary details and ....