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Income Tax Appellate Tribunal, CUTTACK ‘SMC’ BENCH,
Before: SHRI N.S SAINI
This is an appeal filed by the assessee against the order of CIT(A)-
Cuttack, dated 25.1.2016, for the assessment year 2010-2011.
The only grievance in this appeal is that the ld CIT(A) erred in confirming
the action of the Assessing Officer in estimating the income of the assessee @
8% of gross civil contract receipts in an order passed u/s.144 of the Act is
excessive.
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I have heard the rival submissions and perused the orders of lower
authorities and materials available on record. In the instant case, the assessee
is engaged in the business of contract works and the Assessing Officer
required the assessee to produce its books of account, etc for verification. The
Assessing Officer allowed a number of opportunities to the assessee but the
assessee failed to comply with the notice of hearing issued by the Assessing
Officer and, therefore, the assessment was made u/s.144 of the Act by
estimating the income of the assessee applying the rate of 8% to the gross
contract receipts of Rs.1,21,00,287/- and estimating the income at
Rs.9,68,023/-.
On appeal, ld CIT(A) confirmed the action of the Assessing Officer.
Before me, the submission of ld A.R. of the assessee is that during the
year under appeal, the assessee has shown income @ 5.59% of gross civil
contract receipts. He submitted that this Bench of the Tribunal in the case of
other assesses in similar line of business has held the estimation of income
applying the rate of 4.5% to 5% of gross civil contract receipts to be
reasonable. Hence, he prayed that the income of the assessee should be
estimated at 6% of the gross civil contract receipts.
On the other hand, ld D.R. relied on the orders of lower authorities.
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I find that the rejection of books of account by the Assessing Officer is
not challenged before me. The only issue to be adjudicated by me is whether
applying the rate of 8% to the gross civil contract receipts by the Assessing
Officer in estimating the income of the assessee is reasonable or not. The ld
A.R. of the assessee has submitted that the assessee himself has disclosed
income @ 5.59% of gross civil contract receipts. In the given facts and
circumstances of the case, I am of the considered opinion that it would meet
the ends of justice, if the income of the assessee is estimated by applying the
rate of 7% to the gross civil contract receipts. I, therefore, modify the order
of the ld CIT(A) accordingly.
In the result, the appeal filed by the assessee is partly allowed.
Order pronounced in the open court on 05/01/2017 in the presence of parties.
Sd/- (N.S Saini) ACCOUNTANT MEMBER
Cuttack; Dated 05/01 /2017 B.K.Parida, SPS
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Copy of the Order forwarded to : 1. The Appellant : Shantilata Singh, W/o Lt Gokul Kumar Singh, Badahat, Kendrapara 2. The respondent :ITO, Ward-2, Paradeep. 3. The CIT(A), Cuttack 4. CIT, Cuttack 5. DR, ITAT, Cuttack 6. Guard file. //True Copy// BY ORDER,
ASST.REGISTRAR, ITAT, Cuttack