| The Tax Publishers2020 TaxPub(DT) 3858 (Jp-Trib) INCOME TAX ACT, 1961
Section 143(3)
Where AO did not reject books of account of assessee but made lump sum disallowance of contract expenses, considering that in assessee's own case, Tribunal for assessment year 2013-14, deleted all additions wherein NP declared by the assessee was at 8.09% of gross receipts, therefore, looking to the past accepted NP rate of the assessee, net profit for the year under consideration at 10.41% was very reasonable, and no further disallowance was warranted.
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Assessment - Additions to income - AO did not reject books of account of assessee but made lump sum disallowance of contract expenses -
Assessee was in the business of contractor. He was aggrieved by ad hoc disallowance of Rs. 10.00 lacs out of contract expenses. Held: Assessee produced audited books of account, vouchers and details as required by AO. Assessee declared the NP rate of 10.41% of gross receipts subject to further deduction of depreciation and interest. AO found the books of account properly maintained and did not reject books of account and provisions of section 145(3) were not applied. However, AO made general remark and made lump sum disallowance of expenses. In assessee's own case, Tribunal for assessment year 2013-14, deleted all additions wherein NP declared by the assessee was at 8.09% of gross receipts. Thus, looking to the past accepted NP rate of the assessee, net profit for the year under consideration at 10.41% was very reasonable, and no further disallowance was warranted.
Followed:Shashi Kant Khetan, Prop.--M/s. S.K. Khetan v. A.C.I.T. [ITA No. 986/JP/2017, dt. 24-1-2018]
REFERRED : CIT v. Gotan Lime Khanij Udhyog. (2002) 256 ITR 243 (Raj) : 2002 TaxPub(DT) 0479 (Raj-HC) CIT v. Jain Construction Co. & Ors. (2000) 245 ITR 527 (Raj) : 2000 TaxPub(DT) 0876 (Raj-HC) CIT v. SM Bhatiya Associates (1997) 226 ITR 675 (Raj) : 1997 TaxPub(DT) 0295 (Raj-HC) Shashi Kant Khetan v. Asstt. CIT [ITA No. 918/JP/2013, dt. 24-9-2015] The DCIT, Circle-5, Jaipur v. M/s. Rishabh Construction (P) Ltd. [ITA No. 1081/JP/2011, Order, dated 30-8-2012]
FAVOUR : In assessee's favour
A.Y. : 2015-16
IN THE ITAT, JAIPUR BENCH
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