AO directed to adopt 8% of turnover of assessee's business as taxable profits
AO directed to adopt 8% of turnover of assessee's business as taxable profits
Assessee was in the business of contract job with Eastern Railways. Assessee filed return. AO made disallowance of transportation charges etc @10%, as assessee had submitted self made vouchers containing only nature of expenditure but no specific details. CIT(A) upheld additions. ITAT held that estimation of profits at 8% of turnover would meet the ends of justice, and directed AO to adopt 8% of turnover as business profits of the assessee.-501676
1. Assessee was in the business of contract job with Eastern Railway.
2. The assessee filed return of income together with the tax audit report.
3. During the assessment, AO made disallowance of Transportation charges, Travelling and Conveyance, and Hire Charges at the rate of 10% of respective expenditure, as assessee had submitted self made vouchers containing only the nature of expenditure but no specific name or address to whom exactly the money had been paid.
4. AO added it back to the total income of the assessee.
5. CIT(A) upheld the additions.
On appeal, the ITAT held as under:
6. We find that the learned AO had pointed out certain deficiencies in the vouchers and evidences submitted by the assessee before him and accordingly disallowance was made on an estimated basis which resulted in profit percentage of 14.5% which was brought down to 10% by the Learned CIT(A) as against the net profit returned by the assessee at 5.77%.
7. In the facts and circumstances of the case, we find that the estimation of profits at 8% of turnover would meet the ends of justice.
8. The Learned AO is accordingly directed to adopt 8% of turnover as business profits of the assessee.
Case Reference - Sri Sneha Ranjan Roy Vs. A.C.I.T
IN THE INCOME TAX APPELLATE TRIBUNAL, "B" BENCH, KOLKATA
Before : Shri N.V. Vasudevan, Shri M. Balaganesh,
Judicial Member, and Accountant Member
ITA No. 898/Kol/2013
(A.Y: 2009-10)
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