9911796707
TMI Blog2014 (1) TMI 936X X X X Extracts X X X X X X X X Extracts X X X X ..... ssessment order dated 29.12.2009 passed by the Assessing Officer, under Section 143(3) of the Income Tax Act, 1961 (in short "the Act"), for the assessment year 2007-08. 2. In both the appeals, the issue raised is common, namely, determination of assessee's income from the business of contracting. 3. In brief, the facts are that assessee individual is a civil contractor engaged in the business of executing civil construction works for Government organizations and also Private Sector. For the assessment year under consideration, he filed a return of income declaring total income of Rs. 17,16,909/-. The assessee had declared gross receipts of Rs. 3,30,15,099/-and net profit of Rs. 18,62,056/-, which was 5.64% of the gross receipts. In the c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng Officer. Not being satisfied with the order of the CIT(A), assessee is in further appeal before us, both on the point of rejection of the book results and adoption of net profit ratio of 12% instead of 5.64% declared in the return of income. The Revenue in its cross-appeal has challenged the part relief allowed by the CIT(A) whereby the net profit from contracting business has been estimated at 12% as against 15% estimated by the Assessing Officer. Since, the cross grounds relate to the same issue, we proceed to adjudicate the same together. 5. Before us, learned counsel for the assessee submitted that though assessee was aggrieved by the action of the income-tax authorities in rejecting the book results by invoking Section 145(3) of th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessment order both on the point of rejection of book results and the estimation of net profit at 15% of the gross receipts by pointing out that having regard to the discrepancies noticed, adoption of a rate of 15% to estimate the assessee's income from contracting business was justified. 7. We have carefully considered the rival submissions. In so far as the action of the income-tax authorities in rejecting the book results by invoking Section 145(3) of the Act is concerned, the same is not adjudicated on account of the submission of the assessee. The learned counsel for the assessee has canvassed for adoption of the net profit ratio of 8% on contract receipts in the present case in order to estimate the income from the business of con ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... make a reference to the discussion of the CIT(A) contained in para 4 of the appellate order whereby the decision of the Delhi Bench of the Tribunal in the case of Eastern Construction Co. (supra) has been distinguished by noticing that it pertains to an assessee whose contract receipts was below Rs. 40 lacs and therefore, the Tribunal applied the presumptive rate of net profit of 8% incorporated under Section 44AD of the Act. In our considered opinion, the aforesaid point made out by the CIT(A) is quite misplaced inasmuch as the Delhi Bench of the Tribunal was considering the case of an assessee whose books of account were found unreliable and the contract receipts exceeded Rs. 40 lacs. Therefore, the Tribunal observed that strictly speaki ..... X X X X Extracts X X X X X X X X Extracts X X X X
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