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TMI Blog2014 (2) TMI 1329X X X X Extracts X X X X X X X X Extracts X X X X ..... onfronting to the AO and without calling the remand report of the AO. Thus, the decision of the ld. CIT(A) is against the facts of the case, which in fact, has not been brought on record i.e. whether loans pertain to the impugned year or to the preceding year. It will be in the interest of justice, if the matter is set aside to the file of the AO, who will examine the issue whether the said loans pertain to the impugned year or to the preceding year. Whether the loans are genuine and whether at all, the same can be treated as income under section 68 or not but by providing adequate opportunity to the assessee. AO is accordingly directed to decide the issue denovo as regards the disallowance but by providing adequate opportunity of being heard to the assessee. - Appeal of revenue is partly allowed for statistical purposes. - I.T.A. No.595(Asr)/2013 - - - Dated:- 14-2-2014 - Sh. H.S. Sidhu, Judicial Member And Sh. B.P.Jain, Accountant Member Appellant by:Sh. Mahavir Singh, DR Respondent by:Sh.Joginder Singh, CA ORDER PER BENCH ; This appeal of the Revenue arise from the order of the CIT(A), Jammu dated 10.07.2013 for the assessment year 2010-11. The rev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... dly any time left for the undersigned to allow further adjournments. Under these circumstances, there is no option left but to pass an assessment order on the basis of details available in the copy of return downloaded from AST software of the department. The assessee is a contractor and during the period under consideration has shown gross receipts of ₹ 5,14,44,100/- on which a net profit of ₹ 14,09,714/- is shown from this activity. Keeping in view, the over all position of this case, a net rate of 10% is being applied on the gross receipts of ₹ 5,14,44,100/- which gives an income of ₹ 51,44,410/- . The application of rate of 10% is being done by following the case of M/s. Pooja Construction Co. in ITA No.750(Asr)/1992 ( 69 ITD 147) delivered by the ITAT, Amritsar Bench, which has been upheld by the Hon ble Punjab Haryana High Court in their order in ITR No.166 of 1999 dated 10.09.2010. As stated above, the assessee has not availed the opportunities given to him for presenting his case and the unsecured loans of ₹ 22,00,000/- shown by him also remain unsubstantiated in the absence of any explanation from the assessee. These loans are being tr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uld meet the justice in the case of appellant. Therefore, these grounds of appeal of the appellant are allowed and hence, a relief of ₹ 20,57,764/- is allowed to the appellant. 4.3. Ground of appeal No.4 relates to addition of ₹ 22,00,000/- on account of unsecured loans. The appellant has argued that the said loan has been raised in the financial year 2005-06 relevant to the A.Y. 2006-07 and are appearing in the financial statements of the appellant of the earlier years filed with the return of income and accordingly addition on account of said unsecured loans cannot be made in the year under consideration. The appellant has further argued that once the books of accounts are rejected and income is assessed by applying net profit rate, no separate addition can be made. I have carefully gone through the asstt. order and the submission of the appellant, it is observed that the said loans of ₹ 22 lakhs have been raised in the financial year 2005-06 and all these loans have been received through cheque from Mr. Lalit Kumar S/o Sh. Chunni Lal who has also given confirmation for the same. Thus, fact was discoverable by the AO from assessment record which was not do ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... that the decision of ITAT, Amritsar Bench, in the case of M/s. Pooja Construction Co. (supra), which has been confirmed by the Hon ble Punjab Haryana High Court is very old decision. Therefore, he submitted before the ld. CIT(A) to apply net profit rate of 5% following certain decisions of ITAT, Amritsar Bench, mentioned in his written submissions in the case of Mohan Singh Contractor, in ITA No.59/Asr/2012. He also submitted that he is a subcontractor and has further allotted sub contract for completion of work to sub-contractor. Accordingly, margin of profit is distributed among the three parties i.e. main contractor and the contractors of the assessee and relied upon the decision of ITAT, Amritsar Bench, in the case of Mohan Singh Contractor (supra) and prayed to apply a net profit rate of 5% before the ld. CIT(A) and even before us. 6.1. The Ld. CIT(A) without bringing on record any material, merely accepted the submissions of the assessee that he is a sub-contractor and the assessee allots sub contract to other persons and profit is distributed among the three parties as mentioned hereinabove and following the decision of ITAT, Amritsar Bench in the case of Construction ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... The Ld. CIT(A) in his order has stated the fact was discoverable by the AO from the assessment record which was not done by the AO. In fact, ld. CIT(A) himself has just accepted the submission of the assessee and that too without confronting to the AO and without calling the remand report of the AO. Thus, the decision of the ld. CIT(A) is against the facts of the case, which in fact, has not been brought on record i.e. whether loans pertain to the impugned year or to the preceding year. It will be in the interest of justice, if the matter is set aside to the file of the AO, who will examine the issue whether the said loans pertain to the impugned year or to the preceding year. Whether the loans are genuine and whether at all, the same can be treated as income under section 68 of the Act or not but by providing adequate opportunity to the assessee. The AO is accordingly directed to decide the issue denovo as regards the disallowance of ₹ 22,00,000/- but by providing adequate opportunity of being heard to the assessee. Thus, the appeal of revenue is partly allowed for statistical purposes. 8. In the result, the appeal of the Revenue in ITA No.595(Asr)/2013 is partly allowed ..... X X X X Extracts X X X X X X X X Extracts X X X X
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