Construction Business- In absence of Books 8% Net Profit held reasonable in Tax Audit case

In the case in hand, the appellate authorities have not applied Section 44AD as such. Difficulty arose as they had to estimate reasonable rate of net profit. In the absence of any data and details, they applied the net profit rate as mentioned in Section 44AD. As recorded above, we had asked counsel for the Revenue to ascertain whether similar contractors have declared a higher profit rate. Counsel for the Revenue has not been able to point out or state that the other contractors have a higher profit rate, than the net profit rate of 8% as held by the appellate authorities. The said rate was also applied in the assessment year 2010-11. In view of the aforesaid factual position, we do not see any reason to interfere with the impugned order and the appeal is dismissed.

HIGH COURT OF DELHI AT NEW DELHI

Date of Decision: December 09, 2014

 ITA 80/2014

COMMISSIONER OF INCOME TAX-XII

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