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TMI Blog2014 (12) TMI 565X X X X Extracts X X X X X X X X Extracts X X X X ..... ceipts do not exceed ₹ 40 lacs - assessee's gross receipts exceeded ₹ 10 crores – the circular issued by CBDT clarifies the same – thus, it applies to an assessee whose gross receipts do not exceed ₹ 40 lacs, the Tribunal has rightly allowed depreciation to the assessee - net profit rate of 10% was rightly reduced to 6% and as there was no reason to apply such a high gross profit ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tified in allowing deduction on account of depreciation. The judgments in CIT Vs. Chopra Brothers, (252) ITR 412 and CIT Vs. Bhullar Construction (286) ITR 686 relied by the Income Tax Appellate Tribunal do not apply to the present case as they pertain to assessment years before Section 44 AD was introduced into the Act and therefore, are not a precedent for allowing depreciation to the assessee d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... late Tribunal has erred in granting depreciation to the assessee, as his income was calculated at a net profit rate (question Nos. 2 and 3 framed by the revenue)? Section 44 AD (2) of the Income Tax Act, if read in isolation of a circular issued by the Central Board of Direct Taxes would, require us to answer this question, in favour of the revenue. A perusal of the circular, however reveals that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ivil construction work. The new section is applicable to all assessees whose gross receipts from the above mentioned business do not exceed ₹ 40 lakhs. Gross receipts are the amount received from the clients for the contract and will not include the value of material supplied by the client. The income from the above mentioned business will be estimated at 8 per cent of the gross receipts pai ..... X X X X Extracts X X X X X X X X Extracts X X X X
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