M/S. BUILDERS SHREE,JAGATSINGHPUR vs. ACIT, CUTTACK

ITA 213/CTK/2015Status: DisposedITAT Cuttack31 August 2017AY 2010-114 pages
AI SummaryAllowed

What did the Tribunal hold?

The Tribunal held that depreciation should be allowed from the estimated profit, not from the gross contract receipts. It relied on a High Court ruling that depreciation must be allowed when a net profit rate is adopted.

What were the facts?

The Assessing Officer rejected the assessee's book results and estimated profit at 8% of gross receipts without allowing depreciation. The CIT(A) directed depreciation to be deducted from gross receipts before estimating profit.

What were the issues?

Whether depreciation should be allowed from estimated profit or gross receipts when the Assessing Officer rejects book results and estimates income.

Which sections of the Income-tax Act were involved?

Section 145(3)

AI-generated summary — verify with the full judgment below

Income Tax Appellate Tribunal, CUTTACK BENCH, CUTTACK

Before: S/SHRI N.S SAINI & PAVAN KUMAR GADALE

For Appellant: Shri J.M.Patnaik, AR
For Respondent: Shri D.K.Pradhan, DR
Hearing: 29/08

Per N.S.Saini, AM This is an appeal filed by the assessee against the order of the CIT(A)- Cuttack dated 27.2.2015 for the assessment year 2010-2011. 2. The sole issue involved in this appeal is that the CIT(A) erred in confirming the action of the Assessing Officer in not allowing depreciation

at Rs.9,24,287.26 out of the estimated profit.

3.

The brief facts of the case are that the Assessing Officer observed

that the assessee was engaged in the civil contract work. The assessee

had shown gross receipts of Rs.8,19,11,330/- under contract work. The Assessing Officer required the assessee to produce cash book, bank book,

ledger, party ledger, bill register and bank statement. However, the assessee could not produce cash book, bills and

The order continues below.

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