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TMI Blog2015 (9) TMI 1561X X X X Extracts X X X X X X X X Extracts X X X X ..... whom consumables were purchased. In our considered view, the authorities below were fully justified in applying the net profit rate of 12% on gross receipts which is in consonance with the judgement in the case of CIT v M/s Prabhat Kumar (2008 (11) TMI 356 - PUNJAB & HARYANA HIGH COURT) relied on by the Assessing officer. In case of estimation, if the CIT(A) has passed an order by giving cogent reasons, the Tribunal in an appeal either by Revenue or assessee is required to apply its mind and consider the reasons given by CIT(A). CIT(A) has passed a well reasoned order and, therefore, we do not see any ground to interfere with the order of CIT(A). Considering the nature of assessee’s business, net profit rate of 12% on gross receipts is rea ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed that on examination of the ITR filed by the assessee pertaining to assessment year under consideration along with Form 26AS, the following facts came to light:- i. It was seen that the ITR was filed by the assessee on 12.05.2011. As per the provisions of the Income Tax Act, a belated return can be filed within one year from the end of the relevant A.Y. or before the completion of assessment, whichever earlier. In this case, the due date of filing of ITR as per section 139(1) was 31.07.2007. However the assessee could have filed a belated return up to 31.03.2009 or before the completion of assessment, whichever was earlier. Since the assessee failed to file his return within the time limits as specified in the Income Tax Act, 1961, ther ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... books of account and, therefore, no Audit Report, balance sheet and profit and loss account, bills and vouchers etc. could be produced for verification. During assessment proceedings, the Assessing officer recorded the statement of the assessee appearing in para 10 of the assessment order. On analyzing the statement of the assessee, the Assessing officer came to the conclusion that assessee had declared his total income merely on estimated basis and the assessee had not proof/evidence whatsoever to justify the expenses claimed. The Assessing officer further observed that assessee had not expressly or directly claimed any expenditure in his profit and loss account, but he had merely calculated his income @ approximately 7% of his gross rece ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... count and the facts available on record. Accordingly, the Assessing officer required the assessee to show cause as to why the net profit rate declared by him should not be enhanced to 12% in the absence of books of account and other corroboratory evidence and also in view of the decision of Jurisdictional High Court in the case of CIT v M/s Prabhat Kumar [2010] 323 ITR 675(P&H). In the said judgement the Hon'ble High Court held that assessment at 12% of net profit rate of Contract Receipts excluding material supplied, is not arbitrary or perverse and in this case the net profit rate of 12% was held to be a 'reasonable rate of profit' by the Tribunal. Consequently, the Assessing officer made the addition of ₹ 52,65,347/-. 5. Aggri ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s were maintained. The Ld. CIT(A) has stated that in the nature of assessee's business, the number of persons employed could not be large because otherwise the assessee would have been required to file statements to various State agencies administering various labour welfare laws. No muster roll was maintained. The assessee did not furnish information regarding number of persons employed and the name of the parties from whom consumables were purchased. In our considered view, the authorities below were fully justified in applying the net profit rate of 12% on gross receipts which is in consonance with the judgement of the Hon'ble Jurisdictional High Court in the case of CIT v M/s Prabhat Kumar (supra) relied on by the Assessing officer. ..... X X X X Extracts X X X X X X X X Extracts X X X X
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