Assistant Commissioner Of Income Tax Circle-1(1), Muzaffarpur v. M/S Singh Construction Pvt. Ltd. Satpura Colony, Aghoria Bazar, Muzaffarpur

IN THE HIGH COURT OF JUDICATURE AT PATNAMiscellaneous 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. KUMARORAL JUDGMENT(Per: HONOURABLE THE CHIEF JUSTICE) Date : 09-02-2021 Having heard Shri Rishi Raj Sinha, learnedcounsel for the appellants as also perused the record of revenue,this Court finds no reason to interfere, for the Court is notsatisfied of the case involving any substantial question of law. Facts cannot be re-appreciated, as is sought to beurged before us. The Tribunal, while considering the contentionraised by the Revenue, of suppression of percentage of profit,has returned the finding inparagraph no. 3 of the impugnedorder which is reproduced hereinunder: “3. Mr. Sinha vehemently contends during thecourse of hearing that the Assessing Officer hadrightly made the impugned disallowance for lack of substantiation of the expenditure in question at theassessee’s behest during the course of scrutiny. Wemake it clear that the department is fair enough innot disputing all other heads of turn over, incomeand expenditure per se. It only seeks to revive theimpugned estimation. The CIT(A)'s above extractedfindings hold that the assessee has already declaredits profits in tune with various jurisdictionalprecedents relating to Contract business. He hasproperly, kept in mind the said profit rate @6%(supra) for modifying the impugned disallowancefrom 4% to 1%. Learned DepartmentalRepresentative fails to indicate any illegality orirregularity therein at the time of hearing. Ittranspires that the Assessing Officer had not evencompared assessee's expenditure claims with thoseallowed in earlier assessment years under variousheads. We therefore affirm CIT(A)’s findingsgranting part relief to the tax payer. The instant leadappeal ITA No.146/Pat/2018 fails.” We find that such finding is based on the cogentmaterial emanating from the record. It is the case of the Revenue that against the gross receipt of Rs. 62 crores (approximately), the net incomedeclared 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 disallowanceought to have been to theextent of 4% instead of 1%. Significantly, the appellate authority itselfrecorded that in cases of civil contractors, business alike to onecarried out by the assessee, the net rate of profit accepted by theparties is 6%. In this view of the matter, marginal difference of0.19%, less than the accepted rate of profit cannot be said to beunder valued, warranting interference by this Court, more so,when the matter is based on factual matrix. Significantly, at nopoint in time, the Revenue ever challenged the authenticity andcorrectness of Audit Report, certifying the correctness of thebooks 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/NAFRCAV DATEUploading Date12.02.2021Transmission Date