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TMI Blog2018 (6) TMI 545X X X X Extracts X X X X X X X X Extracts X X X X ..... Decided in favor of assessee. Sale of scrap - Held that:- Generally, scraps are generated in the normal course of business and it should be treated as part of business income only - since assessee has already offered 6% of profit, which includes scrap sales - thus appeal of revenue is dismissed. - ITA No. 1404/Hyd/2017 - - - Dated:- 8-6-2018 - SMT P. MADHAVI DEVI, JUDICIAL MEMBER AND SHRI S. RIFAUR RAHMAN, ACCOUNTANT MEMBER Revenue by : Shri M. Naveen Assessee by : Shri K.C. Devdas ORDER Per S. Rifaur Rahman, A. M. This appeal filed by the Revenue is directed against the order dated 21/04/2017 of CIT(A) 1, Guntur for AY 2012-13. 2. Briefly the facts of the case are, assessee, a private limited company engage ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Assessee relied on the decision of ITAT, Hyderabad Bench in the case of M/s. C. Eswara Reddy Company ITA NO. 668 670/Hyd/2009 wherein it was held that estimation of profit at 8% in the case of contractors and 5% in the case of sub-contractors is reasonable. In the said decision the ITAT also referred to the decision in the case of Krishna Mohan Constructions ITA No. 116 117/Hyd/2007 and also the decision of Special Bench in the case of Arihant Builders in 291 ITR 41 (SB). In the light of the above, assessee requested that once best judgment assessment has been made u/s. 144 the profits may be reasonably estimated based on the above decisions of the ITAT, Hyderabad. . 5. After considering the submissions of the ass ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... as against 8% estimated by the AD, ignoring the jurisdictional ITAT decisions estimating the income as 8% in similar cases ? 3. (The Ld. CIT(A) erred in observing that income from sale of scrap is business income and no separate addition is called for, when income from business is estimated? 4. Any other ground that may be urged at the time of hearing. 7. Considered the rival submissions and perused the material on record. We notice that the AO in his remand report accepted that assessee has done work contract with M/s MEIL, M/s Yamne Power Pvt. Ltd. and UAN MAX Infra Ltd. AO himself accepted that M/s MEIL and M/s Yamne Power Pvt. Ltd. are main contractors and assessee is sub-contractor. With regard to UAN, the work order ..... X X X X Extracts X X X X X X X X Extracts X X X X
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