9911796707
TMI Blog1983 (6) TMI 8X X X X Extracts X X X X X X X X Extracts X X X X ..... said Act. The petitioner carried on the business of executing works contracts. In that connection, it entered into an agreement with the Executive Engineer, Tirhut Canal Division, Gandak Project, Hajipur, for execution of works contract in relation to the Project. The case of the petitioner is that it entered into a lump sum agreement with the State of Bihar and in terms thereof, it was supplied with cement, steel, copper sheets, rubber seal, bricks, etc., by the Department. These materials, according to the petitioner, were always to remain the properties of the Department. After the completion of the works, a composite bill for Rs. 11,12,985 (which will be referred hereafter for brevity as " eleven lakhs odd ") was submitted by the pet ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessed in terms of s. 144 of the Act. After the assessment had been made, the petitioner filed an application for review of the assessment. The application for review was allowed by order dated April 30, 1976. Thereafter, the assessment proceeding was adjourned on several dates, but the petitioner failed to appear oil any of the dates. The ITO, therefore, again proceeded to assess in terms of s. 144 of the Act. The assessment order shows that there were only two items of income of the firm, viz., (i) Income from business as per original assessment Rs. 1,11,468 and (ii) Income from undisclosed sources as determined in original assessment Rs. 2,86,292. After this assessment, the petitioner moved the Commissioner in revision. The Comm ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f this contract (such materials and stores, and the prices to be charged therefor as hereinafter mentioned being so far as practicable for the convenience of the contractor, but not so as in any way to control the meaning or effect of this contract are specified in the schedule or memorandum hereto annexed), the contractor shall be supplied with such materials and stores noted in the annexed schedule as are required from time, to time to be used by him for the purpose of the contract only, and the value of the full quantity of materials and stores so supplied at the rates specified in the said schedule may be set off or deducted from any sums then due, or thereafter to become due to the contractor under the contract or otherwise, or against ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nefit of the Supreme Court case to the petitioner. It was contended that the petitioner neither filed before the income-tax authorities the agreement with the Department nor did it furnish details of the materials supplied. The petitioner was given opportunity time and again to do so, but it failed in that behalf. According to him, the facts of the present case were akin to those of Rameshchandra Chaturvedi v. CIT [1980] 121 ITR 116 (Pat), and must be decided on that footing. That being the position on facts, contended the learned standing counsel, the claim of the petitioner for the deduction was untenable and no writ can issue quashing the assessment order. It is well-settled that in the matter of making a best judgment assessment, an a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ion Department and the petitioner, the standard form applies in all works contracts for the same. I am, therefore, inclined to take the view that clause (9), a copy of which was filed before the Commissioner, which is quoted earlier in this judgment, represented one of the terms of the agreement. It must, therefore, be accepted that the stores/materials at all times belonged to the Department. The value of those stores, therefore, did not enter into the profit of the petitioner. Annexure-I to this application is the payment certificate to the petitioner for the accounting year 1972-73. Column 8 of that certificate shows that a sum of Rs. 4,37,609.02 was deducted on account of supply of materials. That not having been paid to the petitioner, ..... X X X X Extracts X X X X X X X X Extracts X X X X
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