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TMI Blog2021 (6) TMI 342X X X X Extracts X X X X X X X X Extracts X X X X ..... will be minimal ie., not beyond 40% of the turnover thus the net profit will be over 50%. The profit margin will be high with respect to purchase and sale of immovable property. Moreover, gross turnover of the assessee is as high as ₹ 16.5 Crs therefore, the provisions of presumptive tax U/s. 44AD of the Act will not at all be applicable nor any positive inference can be drawn from the same in the case of the assessee which the Ld.CIT(A) has relied upon. We are of the view that the order of the Ld. CIT (A) does not have much merit - estimation of net taxable income @ 18% of the turnover would suffice in the case of the assessee. Accordingly, we hereby sustain the Order of the Ld.AO to that extent - Appeal of the Revenue is part ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oss receipts stated in the P L Account of the assessee which worked out to ₹ 4,10,98,225/-. On appeal, the ld. CIT (A) relying on certain decisions of the Hyderabad Bench of the Tribunal and taking note of the rate of tax prescribed under section 44AD of the Act directed the Ld. AO to compute the net profit of the assessee at 10% of its gross receipts by observing as under:- 5.4. In this context, it may be relevant to refer to the decision of ITAT, Hyderabad in the case of R.K. Township Promoters Pvt Ltd. Supra, wherein the Hon ble ITAT examined the facts of similar nature and concluded that when the revenue could not submit or ascertain who had declared higher percentage of income who are in similar nature of business, it is d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... es or business are carried. In the said referred case of decision, the Hon ble ITAT had directed the AO to adopt the profit at 8% based on the findings of a special audit and also considering the percentages of profits in similar lines of business, while also holding that estimation may follow the rates as applied in 44AD cases. In the present case, the appellant failed to furnish the return of income due to which the adoption of comparative rate of profits of the assessee for earlier years was not available. Similarly, the rates as applicable to the other cases of similar nature of business were neither brought on record by the assessee not the AO. Under the circumstances, the only rate as available for adoption was the rate of 8% as presc ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... y. He further submitted that considering the nature and locality where the business is conducted the Ld. AO has fairly estimated the net profit at 25% of the turnover. He therefore prayed that the order of the Ld. AO may be upheld. The Ld. AR on the other hand relied on the order of the Ld. CIT (A). 5. We have heard the rival submissions and carefully perused the materials on record. From the facts of the case, it is apparent that the assessee has grossly erred by not maintaining the particulars of its business. The assessee has also failed to produce the books of accounts and any relevant document concerning the same before the ld. Revenue Authorities. It is also a fact that the assessee is engaged in the real estate business where the ..... X X X X Extracts X X X X X X X X Extracts X X X X
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