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TMI Blog2021 (3) TMI 738X X X X Extracts X X X X X X X X Extracts X X X X ..... in I.T.A.No.2151 / HYD / 2018. 3. The respondent-Assessee was engaged in the business of erection of Boilers and Turbines in Power Plants, Coal Feeding and Transportation and O & M of Power Plants. 4. The respondent-Assessee filed its original return of Income on 18.09.2013 declaring a total income of Rs. 4,01,01,350/-. 5. There was a Search and Seizure operation under Section 132 of the Act in the case of the respondent-Assessee on 14.12.2015 wherein certain discrepancies were noticed in the Labour charges as recorded in the Profit and Loss Account, as compared to the Profit and Loss taken from the Books of Accounts taken in Tally Package. 6. The respondent-Assessee debited expenditure to the tune of Rs. 13,17,47,585/- whereas the Tall ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... difference between the Ledger extract in the Books of Accounts and the Tally Package maintained in the Computer amounting to Rs. 5,24,43,789/- in the labour charges, the Executive Director of the respondent-Assessee in his statement under Section 132(4) of the Act admitted such undisclosed income, but the entire portion cannot be treated as Assessee's income. The Tribunal further held that the Commissioner of Income Tax (Appeals) had recorded that Net Profit of the Assessee is to be estimated at 9% of main contract works and at 6% on sub-contract works; and when finally he disposed of the Appeal, the Commissioner of Income Tax (Appeals) directed the Assessing Officer to adopt 9% of the total turnover which was arrived at before the search. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ar wise is as under : F.Y.2012-13 Difference in Gross receipts Rs. 1,33,50,839.00 F.Y.2012-13 Inflated labour charges booked Rs. 5,24,43,789.00 ============ F.Y. 2014-15 -do- Rs. 3,35,84,422 F.Y. 2014-15 Bogus sub contractors Rs. 5,06,20,950 15. But the answer given by the Executive Director to Question No.35 put to him under Section 132(4) of the Act is also relevant and we quote the same as under : "Q.35 : I am showing you the Annexure / Mech / 13 in which page 76 shows the labour charges booked to the extent of Rs. 7,32,23,284/- and salaries is Rs. 60,80,512/- but in the same FY 2012-13, the salaries and wages are booked to the extent of Rs. 13,17,47,585/- as per copy of P & L account filed along with return of i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... bunal is based on the finding recorded by the Commissioner of Income Tax (Appeals) himself that the Net Profit of the assessee is to be estimated at 9% on main contract works and 6% on sub-contract works. 19. The Tribunal specifically observed that the Commissioner of Income Tax (Appeals) could not have adopted 9% net profit on this entire amount and he ignored the fact that the appellant was also working both as a main contractor and a sub-contractor. 20. Therefore, the finding of the Tribunal appears to be in consonance with the findings of the Commissioner of Income Tax (Appeals), and it did not commit any error in directing the Assessing Officer to recompute the Net Profit at 9% of the turnover on the main contracts and at 6% of the t ..... X X X X Extracts X X X X X X X X Extracts X X X X
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