9911796707
TMI Blog2014 (1) TMI 834X X X X Extracts X X X X X X X X Extracts X X X X ..... ss receipts to be taxed in the hands of the assessee on the basis of book results insofar as the return of 1% income also includes the extra income generated by the assessee on the hiring of the tipper which has been restricted by the learned CIT(A) to 5% as against 24% returned. The Assessing Officer is directed to compute the total receipts income at 1% of the gross freight receipts plus receipts of tipper hiring and also to accept the income returned by the assessee disclosed in the audited Financial Statements for which there can be no separate addition insofar as the disallowance of salary and interest to the partners was not on the basis of assessee not to be subjected to assessment order being passed u/s.144 - The income from inte ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... usiness filed its return of income of Rs.13,58,431 when the assessee on the issuance of notice by the Assessing Officer filed revised return enhancing its income to Rs.73,58,431. During the proceedings u/s.143(3) the assessee explained the reasons for filing the revised return by indicating that a survey had taken place when the assessee had agreed to pay tax on freight expenses. The Assessing Officer required the assessee to explain the Financial Statements duly audited therefore were not correct when the assessee did not respond for explaining u/s.142(1) he estimated the Net Profit at 1% and further verified that a tipper was hired out as plant and machinery was not part and parcel of the freight receipts which was taxed @1% thereon was t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... carried out when the expenses claimed were to be disallowed by the Assessing Officer to calculate 1% of the gross receipts asd income. The fact that the Assessing Officer after taking cognizance of the survey report agreed to enhancement of the income by estimating 1% of the gross receipts and not because the enhancement by the learned CIT(A) was on the rejection of the books of account which were verified at the time of survey were incorporated in the audited Financial Statements for declaring 1% approximately of the gross lorry freight receipts. The learned Counsel of the assessee argued that this was the reason the learned CIT(A) rightly brought to tax only 5% of the tipper hire charges at Rs.74,000 when the receipts on account of tipper ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ncome from tipper clinches the issue in favour of the assessee that the assessee was subjected to enhancement without bringing out any defect on record. The learned Counsel of the assessee also pointed out that the assessee disclosed 0.98% of the gross lorry freight as income and on the tipper disclosed 24% income of receipts which the learned CIT(A) has reduced as detriment to the Revenue. He also submitted that inspite of the appearance by the AR of the assessee the Assessing Officer chose to pass the order u/s.144 in consequence thereto has disallowed interest and salary to partners by invoking the provisions of Section 184(5) which was not dealt with by the learned CIT(A) in view of his enhancing the income assessed by the Assessing Off ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed various expenses including depreciation claimed in the consolidated P L account filed by the assessee when he sought to balance the income rendered by the assessee by way of revised return with a meager difference of Rs.5 lakhs. In other words, it was a juggllery of percentage which the learned CIT(A) sought to correct by himself by holding a view that the gross lorry receipts were more than Rs.80 Crores on which the expenses incurred by the assessee was acceptable to it when the asset put to use by the assessee claiming depreciation for earning income for the tipper was separately indicated. The learned CIT(A) therefore contradicted his own finding by bringing to tax 5% of the lorry receipts to tax which was not the case of the Assess ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ht receipts plus receipts of tipper hiring as was appealed against before the learned CIT(A) on taxation of Rs.14,80,000 and also to accept the income returned by the assessee disclosed in the audited Financial Statements for which there can be no separate addition insofar as the disallowance of salary and interest to the partners was not on the basis of assessee not to be subjected to assessment order being passed u/s.144. All the facts and figures have been doubted by the Assessing Officer on the basis of revised return and furthermore on appearance before the Assessing Officer by the AR of the assessee was not to be assessed on percentage basis which the Assessing Officer chose to incorporate in the assessment order. This clearly indicat ..... X X X X Extracts X X X X X X X X Extracts X X X X
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