Principal Commissioner Of Income ... vs M/S Singh Construction Pvt. Ltd
2021 Latest Caselaw 781 Patna

          IN THE HIGH COURT OF JUDICATURE AT PATNA
                       Miscellaneous Appeal No.171 of 2019
     ======================================================

1. Principal Commissioner of Income Tax- Muzaffarpur

2. Assistant Commissioner of Income Tax Circle-1(1), Muzaffarpur

... ... Appellant/s Versus M/s Singh Construction Pvt. Ltd. Satpura Colony, Aghoria bazar, Muzaffarpur

... ... Respondent/s ====================================================== Appearance :

     For the Appellant/s      :       Mr. Rishi Raj Sinha, Advocate
                                      Ms. Shilpi Keshri, Advocate
     For the Respondent/s     :

====================================================== CORAM: HONOURABLE THE CHIEF JUSTICE and HONOURABLE MR. JUSTICE S. KUMAR ORAL JUDGMENT (Per: HONOURABLE THE CHIEF JUSTICE)

Date : 09-02-2021

Having heard Shri Rishi Raj Sinha, learned

counsel for the appellants as also perused the record of revenue,

this Court finds no reason to interfere, for the Court is not

satisfied of the case involving any substantial question of law.

Facts cannot be re-appreciated, as is sought to be

urged before us. The Tribunal, while considering the contention

raised by the Revenue, of suppression of percentage of profit,

has returned the finding in paragraph no. 3 of the impugned

order which is reproduced hereinunder:

"3. Mr. Sinha vehemently contends during the course of hearing that the Assessing Officer had rightly made the impugned disallowance for lack of Patna High Court MA No.171 of 2019 dt.09-02-2021

substantiation of the expenditure in question at the assessee's behest during the course of scrutiny. We make it clear that the department is fair enough in not disputing all other heads of turn over, income and expenditure per se. It only seeks to revive the impugned estimation. The CIT(A)'s above extracted findings hold that the assessee has already declared its profits in tune with various jurisdictional precedents relating to Contract business. He has properly, kept in mind the said profit rate @6% (supra) for modifying the impugned disallowance from 4% to 1%. Learned Departmental Representative fails to indicate any illegality or irregularity therein at the time of hearing. It transpires that the Assessing Officer had not even compared assessee's expenditure claims with those allowed in earlier assessment years under various heads. We therefore affirm CIT(A)'s findings granting part relief to the tax payer. The instant lead appeal ITA No.146/Pat/2018 fails."

We find that such finding is based on the cogent

material emanating from the record.

It is the case of the Revenue that against the

gross receipt of Rs. 62 crores (approximately), the net income

declared was just 5.81%, which is Rs. 3.64 crores

(approximately), and ought to have been on the higher side.

Further, it is argued that disallowance ought to have been to the

extent of 4% instead of 1%.

Patna High Court MA No.171 of 2019 dt.09-02-2021

Significantly, the appellate authority itself

recorded that in cases of civil contractors, business alike to one

carried out by the assessee, the net rate of profit accepted by the

parties is 6%. In this view of the matter, marginal difference of

0.19%, less than the accepted rate of profit cannot be said to be

under valued, warranting interference by this Court, more so,

when the matter is based on factual matrix. Significantly, at no

point in time, the Revenue ever challenged the authenticity and

correctness of Audit Report, certifying the correctness of the

books of accounts maintained by the assessee.

Hence, impugned order dated 26.09.2018 passed

by the Tribunal in I.T.A. No. 146/Pat/2018 is affirmed.

Appeal stands dismissed.

(Sanjay Karol, CJ)

( S. Kumar, J)

sujit/-

AFR/NAFR
CAV DATE
Uploading Date          12.02.2021
Transmission Date