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TMI Blog2020 (4) TMI 818X X X X Extracts X X X X X X X X Extracts X X X X ..... d get then audited is only on the assessee who opts to claim the income being less than 8 per cent of the gross receipts. Argument of the revenue that the turnover of the assessee has been doubted by the Assessing Officer is totally ill-found, in view of the overwhelming evidences proving contra. Further, it is a fact on record that the assessee had not maintained books of account that is why he opted for 8 per cent income as per section 44AD of the Act. The section also does not put obligation on the assessee to maintain books of account, more so, in view of the fact that his income has been assessed as per section 44AD of the Act, he cannot be punished for not maintaining the same. The argument of the revenue that the assessee was in fact, not in the eligible business untenable. Confirmations of the parties, having proved their sources and creditworthiness, the entries in the bank statement, the payments made for purchase of material and keeping in view, the place of execution of the work, we hold that the addition made by the Assessing Officer is liable to be deleted. - Decided in favour of assessee. - ITA No. 4744/Del/2016 - - - Dated:- 24-2-2020 - Sh. Kuldip Singh, J ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ing conducted thereafter. Confirmation from Sh. Zamir Ahmed PAN AFAPA0916J Ward- 22(2), New Delhi was filed Sh. Zamir Ahmed certified that he paid an amount of ₹ 18 lakh against construction of house No. F-6B, Second Floor, Shaheen Bagh, Zamia, Okhla, New Delhi. 5. It was noticed by the AO that out of the above amount, an amount of ₹ 8 lakh was received in cash and ₹ 10 lakh was received by cheque. But no detail of cheque receipts were furnished by the assessee before the AO. The AO issued notice u/s 133(6) to ascertain the genuineness of the transaction, but the same remain uncomplied with. The Assessing Officer further verified the facts from Ward-22(2), New Delhi and found that Sh. Zamir Ahmed had not filed income-tax return for the AY 2011-12. In respect of other party i.e. Sh. S.U. Khan, the assessee neither provided PAN details nor any detail with regard to receipt of payment received from this party. In view of above facts, it was held by the AO that the assessee has background of teaching and his contention that he was engaged in civil construction activities cannot be accepted to, since he has no previous experience of civil construction and no cont ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... arguments before us, the ld. AR explained through the documents filed before the ld. CIT (A). The ld. DR supported the orders of the authorities below. 9. Heard the arguments of both the parties and perused the material available on record. 10. From the facts on records, we find that in toto the assessee has received ₹ 50,50,000/- towards the construction activities. The same are reflected in the Indian Bank account maintained by the assessee. Sh. Zamir Ahamed filed a confirmation before the ld. CIT (A) that he has paid an amount of ₹ 18,00,000/- against the construction of his house to the assessee. The details of the payments are as under: S.No. Date Amount Remark 1. 31.05.2010 ₹ 5,00,000/- Cash Paid 2 . 08.11.2010 Rs. 2,00,000/- Cheq Issued. 3. 18.11.20l0 ₹ 1,50,000/- Cheq Issued. 4. 26.11.20iO ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... of the assessee cannot be held to be valid. 14. Regarding the payment made by Sh. S.U. Khan, we find that he has responded to the notice issued u/s 133(6) through Speed Post vide letter dated 26.02.2014. He was working in Afghanistan as an employee of FAO/UN. Hence, the allegation of the revenue that the payer has not filed the ITR and consequent confirmation in the hands of the assessee cannot be held to be valid. 15. The bank statement of the assessee shows that number of payments have been made against the purchase of items like Iron, Steel, cement and other building materials. Hence, it cannot be said that the assessee has not executed the work of construction activity. The returns of the assessee for the assessment year 2010-11 examined by the revenue u/s 147 proved the fact that the assessee is in the business of manufacturing the sign boards and registered with Delhi VAT department. We also find that the amounts received by the assessee are the construction receipts received from the assessee as per the bank accounts of the payer namely, the NRE savings bank account maintained with SBI and also from the Standard Chartered bank statement of Sh. Zamir Ahmed. From the fa ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t to the previous year in which the profit has not been declared in accordance with the provisions of sub-section (1). (5) Notwithstanding anything contained in the foregoing provisions of this section, an eligible assessee to whom the provisions of sub-section (4) are applicable and whose total income exceeds the maximum amount which is not chargeable to income-tax, shall be required to keep and maintain such books of account and other documents as required under sub-section (2) of section 44AA and get them audited and furnish a report of such audit as required under section 44AB.] 19[(6) The provisions of this section, notwithstanding anything contained in the foregoing provisions, shall not apply to- (i) a person carrying on profession as referred to in sub-section (1) of section 44AA; (ii) a person earning income in the nature of commission or brokerage; or (iii) a person carrying on any agency business.] Explanation.-For the purposes of this section,- (a) eligible assessee means,- (i) an individual, Hindu undivided family or a partnership firm, who is a resident, but not a 20limited liability partnership firm as defined under clause (n ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or above of the gross receipts. In that case, the provisions of sub-section (5) of the said section will be applicable to it. 21. From the combined reading of sub-section (1) and sub-section (5), it is apparent that the obligation to maintain the books of account and get then audited is only on the assessee who opts to claim the income being less than 8 per cent of the gross receipts. 22. We find that the argument of the revenue that the turnover of the assessee has been doubted by the Assessing Officer is totally ill-found, in view of the overwhelming evidences proving contra. Further, it is a fact on record that the assessee had not maintained books of account that is why he opted for 8 per cent income as per section 44AD of the Act. The section also does not put obligation on the assessee to maintain books of account, more so, in view of the fact that his income has been assessed as per section 44AD of the Act, he cannot be punished for not maintaining the same. The argument of the revenue that the assessee was in fact, not in the eligible business untenable. 23. Hence, keeping in view the provisions of the Act, the confirmations of the parties, having proved their sour ..... X X X X Extracts X X X X X X X X Extracts X X X X
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