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TMI Blog2015 (6) TMI 274X X X X Extracts X X X X X X X X Extracts X X X X ..... essee has FDR investment in this year and the same was undisclosed in the balance sheet. If these FDRs were purchased in earlier year then it was the burden on the assessee to establish that by bringing necessary evidence on record. As per the chart reproduced by CIT(A) on pages 8 to 10 of his order, apart from Sl.No. 15 & 16 also, there are other FDRs which were purchased in the present year i.e. Sl.No. 3 ₹ 3,66,262/-, Sl. No. 6 ₹ 6,66,407/-. Moreover, even if balance FDRs were purchased during the financial year 2008-09 and the same were out of undisclosed sources then also interest on such investment for the present year should be added in assessment year 2009-10 and CIT(A) should have given such direction to the Assessing Officer for making such addition in assessment year 2009-10. The interest accruing in present year on those investments in FDR made in financial year 2008-09 should have been added in present year. Considering these facts, we feel that the order of CIT(A) is not sustainable and the same required a fresh decision in the light of above discussion. Hence, we set aside the order of CIT(A) and restore the matter back to him for fresh decision after prov ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... erial available on record and gone through the orders of the authorities below. We find that this issue was decided by learned CIT(A) by making following observations on page No. 11 12 of his order, which are reproduced below for the sake of ready reference:- Ground No.4 in respect of application of N.P. rate 8% and assessed extra profit of ₹ 39,62,925/-. The A.O. has discussed this issue in Para- 4(A) of the assessment order mentioned supra. The A.O. has applied N.P. rate 8% of gross contract receipts of ₹ 7,94,07,164/- against shown by appellant 3.01% in his books of accounts. The appellant has filed written submission during appellate proceedings and contended that the application of N.P. rate 8% by A.O. was arbitrary/unjustified. The appellant has mentioned in his written submission that the A.O. should have taken into consideration his own past history in estimation of net profit derived from Civil Contract work, as the appellant did the civil contract work last so many years. The appellant has also furnished the comparative chart of contract receipts, net profit, percentage of net profit rate and finally assessed income by A.O. and CIT (Appeals) in earlie ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... here the provisions of section 145(3) are applied. Hence considering the facts circumstances mentioned above the net profit of appellant is assessed and confirmed to the extent of ₹ 27,00,000/- against shown by the appellant of ₹ 23,89,648/-. Thus to the extent of ₹ 3,10,352/- (Rs.27,00,000- 23,89,648) addition made by A.O. under this head is hereby confirmed and rest of addition is liable to be deleted. The A.O. is directed to delete the addition of ₹ 36,52,673/- (Rs.39,62,925-3,10,352). Thus the appellant gets relief of ₹ 36,52,673/-. This ground is partly allowed. 4.1 From the above Paras from the order of learned CIT(A), we find that it is noted by him that in earlier years, the final assessed income of the assessee was in the range of 0.98% to 2.5%. In the subsequent year i.e. assessment year 2011-12, the income of the assessee was assessed at 2.09% on contract receipt of ₹ 1636.39 lac. In the present year, the contract receipt is ₹ 794.07 lac. The decision of the CIT(A) to assess the income of the assessee at ₹ 27 lac results into net profit rate of 3.40% as against 8% estimated by the Assessing Officer. Since in th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... consideration. However it is observed from the details provided by appellant in respect of FDRs mentioned in said chart, the appellant has invested in FDRs reflected in Sl. No. 15 16 during the assessment year under consideration and rest of entire FDRs from Sl. 1 to 47 were found invested prior to assessment year under consideration. During the appellate proceedings also the appellant has failed to explain the source of investment of ₹ 2,73,239/- (Rs.1,00.000 on 29.05.2009 ₹ 1,73,239 on 21.08.2009) in purchases of these two FDRs. Therefore, to this extent the action of A.O. treating the investment in FDRs as unexplained/undisclosed in the hands of appellant. Thus the A.O. was justified in making the additions of ₹ 2,73,239/- being undisclosed investment in the hands of appellant made by him during assessment year under consideration. Since the rest of investment were made in earlier assessment years and the initial investment + accumulated interest are included in the balances of FDRs as on 21.03.2010, therefore, the A.O. was not justified in making the addition on account of undisclosed investment in FDRs of ₹ 87,50,211/- and same liable to be deleted ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s ground is allowed. 9. In the result, the appeal of the Revenue stands allowed in the terms indicated above. 10. Now we take up the Cross Objection of the assessee. In this Cross Objection, the assessee has raised the following grounds: 1. That on facts and in the circumstances of the case, the learned Commissioner of Income-tax (Appeals)-II, Lucknow is not justified in estimating the appellant's income at ₹ 27,00,000/- as against ₹ 63,52,573/- which is excessive and unreasonable. 2. That the learned Commissioner of Income-tax (Appeals) is not justified in holding that ₹ 2,73,239/- invested in purchase of FDRs does not relate to the year under appeal and hence it is liable to be disallowed. 3. That the learned Commissioner of Income-tax (Appeals) erred in not deleting the interest levied by the Assessing Officer under section 234B of the I.T. Act as tax was deductible at source on the entire receipt from contract business and salary income as held in the case of DIT v. NGC Network Asia LLC [2009] 313 ITR 187 (Bom). CIT and Another vs. Oswal Exports [2014] 369 ITR 630 (All). 11. Learned A.R. of the assessee reiterated the same contentions w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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