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TMI Blog2013 (3) TMI 648X X X X Extracts X X X X X X X X Extracts X X X X ..... ant on adhoc basis by a non-speaking & non-reasoned order at 6% of gross contract receipts & without further allowing depreciation, interest & salary to the partners arbitrarily disregarding the decision in comparable & identical cases of the contemporaneous period. An appropriate & suitable net profit rate subject to further deduction of depreciation, interest and salary to partners may kindly be applied, CIT(A)'s order interfered with & relief allowed to the appellant. 2. The appellant craves leave to add, amend, alter, modify, substitute or delete any ground at the time or before hearing of appeal." 2. The assessee also filed application for admission of additional ground No. 3, which reads as under : "3. That ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 12.5% on gross receipts subject to allowing deduction u/s. 40(b) and depreciation and computed the income of assessee at Rs. 1,32,23,561/-. The addition was challenged before the ld. CIT(A) on several grounds. The written submission of the assessee is incorporated in the appellate order, in which the assessee mainly explained that he maintained complete books, which are audited and complete details including bank account, TDS and payments made to sub-contractors along with bills and vouchers were furnished. Therefore, rejection of books of account is not justified. Since the assessee has to work in different and far off places, therefore, in its urgency, the works had to be completed within the set time frame and it is not possible to maint ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... 86 ITR 383, in which it was held that even after rejection of the books of account when estimate of income is made on the basis of material available and past assessments, no question of law arises. He has also relied upon other decision of ITAT, Agra Bench in the case of Osho Associates vs. ACIT (PB-4) on the proposition that reasonable profit rate has to be estimated. 5. On the other hand, the ld. DR relied upon the orders of the authorities below and submitted that specific defects have been pointed out in maintenance of vouchers and books of accounts and, therefore, profit rate of 6% applied by the ld. CIT(A) is reasonable. The ld. counsel for the assessee in further submissions submitted that in case appropriate and reasonable net pro ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the case. The ld. counsel for the assessee clearly stated that in case reasonable net profit rate is applied, he would not claim further deduction u/s. 40(b) and depreciation etc. Considering the history of the assessee as noted above, we are of the view that it would be reasonable and proper to apply the net profit rate of 3% against admitted receipts for the purpose of computing the business income of the assessee as against 6% profit rate applied by the ld. CIT(A) without giving further deduction to the assessee. We, therefore, modify the orders of the authorities below and direct the AO to apply net profit rate of 3% against admitted receipt of the assessee and profit would be estimated at Rs. 40,61,505/- and after deducting income decl ..... X X X X Extracts X X X X X X X X Extracts X X X X
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