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TMI Blog2010 (11) TMI 372X X X X Extracts X X X X X X X X Extracts X X X X ..... e with the assessee or that these were not produced despite specific directions - The AO has not pointed out the bills and vouchers, which were not produced - Hence, the ld. CIT(A) has not violated the provisions of Rule 46A of the Income-tax Rules,1962 as submitted by the ld. Counsel for the assessee - The ld. CIT(A) has exercised his powers mentioned in Section 250(4) of the Act, which provides that the ld. CIT(A) may remand the case to the AO and call for a remand report on the assessment generally or on certain points - In view of the remand report, the ld. CIT(A) was justified in allowing the appeal of the assessee - Hence, dismissed the appeal of the Revenue. - ITA No. 519(Lkw)/2010 - - - Dated:- 23-11-2010 - H.L. Karwa, N.K. S ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eal." 3. Briefly stated the facts of the case are that the assessee, a private limited company, is engaged in obtaining and executing contract works for which proper books of account were kept in regular course of business, which were audited by Chartered Accountants. For the assessment year under consideration, return of income showing a loss of Rs.1,25,130 was filed on 31.10.2005, which was processed under Section 143(1) of the Income-tax Act,1961(In short "the Act") on 18.11.2005. The case was selected for scrutiny assessment and therefore notice under Section 143(2) was issued to the assessee on 18.8.2006. The AO afforded various opportunities of being heard to the assessee. However, there was no compliance on the part of the assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... h lower margin of profit than its competitors. The assessee had no proper understanding of this business and the tricks of the trade and therefore it could not manage the business properly and its expenses of the business were high. Consequently, the assessee suffered a loss of Rs.1,25,130 in the business; (viii) That the year under consideration was the second year of the assessee's business as civil contractor; (ix) That the book results of the assessee relating to the preceding year were accepted by the Department and net profit rate of 0.41% was not disturbed; (x) That there has not been change in the factual position this year in comparison to the factual position in the preceding year. 5. The ld. CIT(A) vide letter dat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t the confirmatory letter from M/s. S.B. Traders, Unnao alongwith copy of account of the director has been filed before him and examined. 3.5.2. From the remand report of the A.O., it is seen that he could not find any defect in the books of accounts produced before him by the appellant, on being required to send a factual report in regard to the acceptability of the book results and justification of estimation of the net profit by applying a rate of 8%. I find that the A.O. has not made any adverse comments on these issues. In view of the remand report of the A.O., I find no justification in the estimation of income of the appellant @ 8% as made by the AO in the ex-parte order passed by him u/s 144 of the Act. The addition made is accor ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nable. He also submitted that there was no violation of provisions of Rule 46A of the Income-tax Rules, 1962 as submitted by Shri Anadi Verma, ld. D.R. Shri Rakesh Garg,Advocate, ld. Counsel for the assessee pointed out that as per the provisions of section 250(4) of the Act, the ld. CIT(A) may remand the case to the AO and call for a report on the assessment generally or on certain points. Section 250(4) of the Act reads as under: "Section 250 (4) The Commissioner (Appeals) may, before disposing of any appeal. make such further inquiry as he thinks fit, or may direct the Assessing Officer to make further inquiry and report the result of the same to the Commissioner (Appeals)." Under the powers specified in Section 250(4) of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fully Sd. (A.P.Kulshrestha) Income Tax Officer, Unnao." We find considerable force in the submissions of Shri Rakesh Garg, Advocate, ld. Counsel for the assessee. In our considered view, the ld. CIT(A) has not violated the provisions of Rule 46A of the Income-tax Rules,1962 as submitted by the ld. Counsel for the assessee. The ld. CIT(A) has exercised his powers mentioned in Section 250(4) of the Act, which provides that the ld. CIT(A) may remand the case to the AO and call for a remand report on the assessment generally or on certain points. In view of the remand report, the ld. CIT(A) was justified in allowing the appeal of the assessee. On a perusal of the remand report of the AO reproduced hereinabove, it is clear that he co ..... X X X X Extracts X X X X X X X X Extracts X X X X
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