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TMI Blog2018 (3) TMI 2006X X X X Extracts X X X X X X X X Extracts X X X X ..... n presumptive taxation basis u/s. 44AD of the Act. The contention of the A.O. that the recipients are not maintaining any details is ill-founded because of the immunity granted u/s. 44AD of the Act. The recipients are not obliged to maintain any books of accounts if they return their profit u/s. 44AD of the Act. Further, the income of Saumya Mining Ltd. has been accepted as such in its assessment framed u/s. 143(3) of the Act. In our considered opinion, when the contract receipts of the assessee has been accepted in toto. We fail to understand if the assessee has not incurred these expenditures then how could it execute the contract work allotted to it. Also as the books of accounts of the assessee are audited and the A.O. has not pointed o ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... accordingly statutory notices were issued and served upon the assessee. During the year under consideration, a survey u/s. 133A of the Act was conducted on 2.06.2010 on the business premises of the assessee. During the course of the survey operations, statement of Shri Rajesh Agrawal was recorded who offered an amount of Rs. 3.75 crores on account of bogus trade creitors as his undisclosed income for the year under consideration. 5. During the course of the scrutiny assessment proceedings, the A.O. asked the assessee to furnish the details of expenses claimed under the head work payment at Rs. 18.06 crores. The A.O. found that in the immediately preceding year, the assessee has claimed Rs. 12.50 crores. The assessee was asked to justify t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ther, the A.O. noticed that the assessee has claimed expenditure of Rs. 7,96,72,605/- on account of excavation and dressing of soil being paid to Saumya Mining Limited. The assessee was asked to furnish the relevant details in support of its claim. The assessee submitted quantity details of work done by Saumya Mining Limited and bill submitted to Government Department. The A.O. was not satisfied with the contentions of the assessee. The A.O. was of the firm belief that by claiming these bogus expenses, the profit of the assessee has reduced substantially. Comparing the profit ratio with the immediately preceding year, the A.O. formed a belief that the expenditures are bogus and accordingly disallowed the same. 9. Assessee strongly agitated ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the orders of the authorities below and with the assistance of the ld. Counsel, we have considered the relevant documentary evidences brought on record in the form of paper book in the light of Rule 18(6) of the ITAT Rules. We find that the A.O. has been simply carried away with the fact that the payees are related to one of the directors of the assessee company. At the same time, we find that the A.O. has not drawn support from the provisions of Section 40A(2)(b) of the Act. Neither the A.O. has brought on record any comparable case nor he has brought any material on record to disbelief the claim of the assessee. The work contract payments made to 8 persons are duly supported by respective bills furnished by them and so also excavation wo ..... X X X X Extracts X X X X X X X X Extracts X X X X
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