9911796707
TMI Blog2014 (6) TMI 1031X X X X Extracts X X X X X X X X Extracts X X X X ..... on of income - Treating the interest from FDRs as income from other sources or business income - HELD THAT:- Facts of the case are that by the assessee the FDRs were raised on the compulsion of taking contract from Government department on which interest accrued to the assessee. This is also a settled position of law that in such civil contract cases, when necessarily the FDRs have to be purchased and have to be kept as security for obtaining contracts, such interest received is treated as business income - CO No. 15/JU/2014 A/o ITA No. 64/JU/2014 Assessment Year: 2009-10 - - - Dated:- 12-6-2014 - Shri Hari Om Maratha, Judicial Member And Shri N.K.Saini, Accountant Member Assessee by: Shri Rajeev Sogani Depar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ho is carrying on the business of a civil contractor. On gross contract receipts, the assessee firm has disclosed net profit of ₹ 16,73,373/- after claiming interest to partners and third party of ₹ 6,52,388/- and remuneration for partners of ₹ 12,03,082/- and also depreciation of ₹ 36,780/-. The net profit before depreciation, interest and remuneration to partners in terms of percentage comes to 2.75% which has been considered by the A.O. to be on lower side. The A.O. rejected the books of account of the assessee-firm and has adopted net profit rate of 10% to make the impugned addition. The ld. CIT(A) has restricted it to 6.5%. The assessee has disclosed 5.49% of net profit rate. In A.Y. 2006-07 while comp ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... her sources. 7. Briefly stated, the facts of the case are that by the assessee the FDRs were raised on the compulsion of taking contract from Government department on which interest accrued to the assessee. This is also a settled position of law that in such civil contract cases, when necessarily the FDRs have to be purchased and have to be kept as security for obtaining contracts, such interest received is treated as business income. The ld. CIT(A) has correctly taken decision on Ground No. 2 as well. Ground No. 2 of revenue s appeal accordingly stands dismissed. 8. In the result, the appeal of the revenue stands dismissed whereas the cross objection of the assessee stands partly allowed. Order Pronounced in t ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
