GANADHISH GNP,NAVI MUMBAI vs. DCIT CIRCLE 6(1), MUMBAI, MUMBAI

The assessee has offered average net income from construction business in the audited books of accounts for the period A.Y. 2018-19 to 2022-23 at 18.33%. The action of the AO to treat the whole on money receipt of Rs. 13,65,13,712/- as part of net profit would result in abnormal net profit as about 70% on the sale amount of Rs. 32,97,59,363/- after adding the on money result of Rs. 13,65,13,712/- to the net profit of Rs. 9,33,89,589/- already declared as per the books of account. We further noticed infirmities in the consolidated income computed by the ld. CIT(A). Since the assessee was following the project completion method but for the A.Y. 2020-21 no sale/revenue was mentioned against the net incme / net profit of Rs. 1,31,95,081/- which was shown for the A.Y. 2020-21 for the purpose of arriving consolidated income of all the years at the average net profit of 26% because the ld. CIT(A) at page no 20 of the order has considered the net profit for the A.Y. 2020-21 @ 13%. Therefore, we consider that the profit embedded in the on-money transaction is reasonable to estimate @ 22%. Therefore, we estimate the net profit @ 22% of accounted receipt of Rs. 3,79,07,014/- instead of 26% estimated by the ld. CIT(A). Accordingly, the appeal of the assessee is partly allowed and appeal filed by the Revenue is dismissed.

Since on similar issue and identical fact vide we have partly allowed the appeal of the assessee by estimating the net profit @ 22% on unaccounted business receipt. Therefore, applying the findings of the same mutatis mutandis the net income of the assessee from unaccounted business is also estimated @ 22%. Therefore, the appeal of the assessee is partly allowed. (A.Y. 2021-22) (Assessee Appeal) 11. Since on similar issue and identical fact vide we have partly allowed the appeal of the assessee by estimating the net profit @ 22% on unaccounted business receipt. Therefore, applying the findings of the same mutatis mutandis the net income of the assessee from unaccounted business is also estimated @ 22%. Therefore, the appeal of the assessee is partly allowed. (A.Y. 2021-22) (Revenue Appeal) 12. Since this appeal of the Revenue is based on identical issue on similar fact to the for A.Y. 2019-20 as adjudicated (supra) in this order by which the appeal of the Revenue is dismissed applying the findings of the same mutatis mutandis this appeal of the Revenue is also dismissed.

In the result, all the appeals filed by the assessee are partly allowed and all the appeals filed by the Revenue are dismissed.