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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 ..... assessment proceedings, without recording in writing the reasons for its admission in contravention to the provisions of Rule 46A of I.T. Rules. 2. The Ld. CIT(A) has erred in law and facts in deleting the estimation of net income of the assessee @8% of gross receipts as per provisions of section 44AD of the I.T. Act on the basis of remand report of the A.O.where assessee produced books of account and some of vouchers suddenly. 3. The Ld.CIT(A) has erred in law and facts in deleting the estimation of income and failed to appreciate that the assessee could not able to produce any bills, vouchers, books of account during the whole assessment proceedings. Further, Ld.CIT(A) has also failed to appreciate that no separate additi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ontractor engaged in civil construction business; (ii) That the assessee maintained proper books of account, which were audited by the Chartered Accountant; (iii) That after rejecting the book results, the AO estimated the total income at Rs.22,71,820 by applying a net profit rate of 8% on gross receipts of Rs.2,83,97,779 under Section 44AD of the Act against the returned loss of Rs.1,25,130 as per Profit and Loss Account; (iv) That the rate of net profit at 8% applied by the AO is uncalled for looking to the very high turnover achieved by the assessee; (v) That Section 44AD is not applicable in the case of the assessee since the gross receipts were to the tune of Rs.2,83,97,779; (vi) That it is a gen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tion 44AD of the Act. This has been done by the AO primarily for the reason that the assessment has been completed ex-parte under section 144 of the Act and the AO also did not have the benefit of examination of the books of accounts of the appellant company. It is in such circumstances that the AO has estimated the income of the appellant @ 8% of the gross receipts. 3.5.1. As discussed herein above, the appellant took the stand before me that it is in a position to produce all the books of accounts and other supporting documents for verification; it was for this reason that the AO was required to submit a remand report after affording an opportunity being heard to the appellant and after examining the books of accounts produced bef ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before the AO in the assessment proceedings without recording in writing the reasons for its admission in contravention of the provisions of Rule 46A of the Income-tax Rules, 1962. He,therefore, submitted that the order of the ld. CIT(A) may be vacated and that of the AO be restored. According to the ld.D.R., the AO was justified in estimating the net income of the assessee at the rate of 8% of gross receipts as per provisions of Section 44AD of the Act. On the other hand, Shri Rakesh Garg, Advocate, ld. Counsel for the assessee submitted that the ld. CIT(A) was justified in holding that the provisions of Section 44AD were not applicable to the facts of the present case since gross receipts are; to the tune of Rs.2,83,97,779 which are far ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been completed ex parte u/s 144 of the I.T. Act, on account of noncompliance of the notices issued to the assessee and for non-production of account - books and other details as required from time to time, for the reasons best known to the company. The assessing officer in the absence of books of account and any explanation or supporting evidence of the audited copies of accounts, worked out the income treating it as ' No account case u/s 44AD of the I.T. Act and estimated the income @8% of the total receipts as shown by the assessee and made no further addition on account of expenses claimed, sundry creditors and on additions to fixed assets. However the assessee has produced before me Cash book Ledger and Journal alongwith details ..... X X X X Extracts X X X X X X X X Extracts X X X X
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