THE ITO, WARD - 1, Gudivada V. Sri Uppalapati Giridhar Kumar, Kaikaluru

ITA 50/VIZ/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 1173 (ITAT-VISAKHAPATNAM)
• Duration Of Justice: 3 year(s) 2 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 29-04-2016
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: DB
• Assessment Year: 2009-2010
• Appeal Filed On: 01-02-2013
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: P SRINIVASA MURTHY
• Assessee Lawyers: S RAMA RAO
• Keywords: Rejection of books of accounts
• Section: 142(1)

Judgement Text

ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 1 , , IN THE INCOME TAX APPELLATE TRIBUNAL, VISAKHAPATNAM BENCH, VISAKHAPATNAM . , . , $ BEFORE SHRI V. DURGA RAO, JUDICIAL MEMBER & SHRI G. MANJUNATHA, ACCOUNTANT MEMBER ./I.T.A.NO.50/VIZAG/2013 ( / ASSESSMENT YEAR: 2009-10) ITO , WARD - 1 , GUDIVADA VS. U. GIRIDHAR KUMAR KAIKALURU [PAN: AACPU 7766P ] ( / APPELLANT) ( / RESPONDENT) C.O. NO.61/VIZAG/2013 (ARISING OUT OF I.T.A.NO.50/VIZAG/2013) ( / ASSESSMENT YEAR: 2009-10) U. GIRIDHAR KUMAR KAIKALURU VS. ITO, WARD - 1, GUDIVADA ( / APPELLANT) ( / RESPONDENT) / APPELLANT BY : SHRI P. SRINIVASA MURTHY, DR / RESPONDENT BY : SHRI S. RAMA RAO, AR / DATE OF HEARING : 21.04.2016 / DATE OF PRONOUNCEMENT : 29.04.2016 ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 2 / O R D E R PER G. MANJUNATHA, ACCOUNTANT MEMBER: THIS APPEAL FILED BY THE REVENUE AND CROSS OBJECTI ON FILED BY THE ASSESSEE ARE DIRECTED AGAINST THE COMMON ORDER PASS ED BY THE CIT(A), VIJAYAWADA DATED 30.11.2012 AND IT PERTAINS TO THE ASSESSMENT YEAR 2009-10. SINCE, THE FACTS ARE IDENTICAL AND ISSUES ARE COMMON, THEY ARE CLUBBED, HEARD TOGETHER AND DISPOSED OFF, BY WAY OF THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSE E IS AN INDIVIDUAL DERIVES INCOME FROM FISH PONDS AND EXECUTION OF WOR KS CONTRACTS. THE ASSESSEE HAD FILED HIS RETURN OF INCOME FOR THE ASS ESSMENT YEAR 2009-10 ON 30.9.2009 DECLARING TOTAL INCOME OF RS.6,26,230/ -. THE CASE HAS BEEN SELECTED FOR SCRUTINY AND ACCORDINGLY, NOTICES U/S 143(2) & 142(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER CALLED AS THE ACT) WERE ISSUED. IN RESPONSE TO THE NOTICES, THE AUTHORIZED REPRESENTATIVE OF THE ASSESSEE APPEARED FROM TIME TO TIME AND FURNISHED B OOKS OF ACCOUNTS AND RELEVANT DETAILS. DURING THE COURSE OF ASSESSM ENT PROCEEDINGS, THE A.O. NOTICED THAT THE ASSESSEE IS INTO THE BUSINESS OF PISCI CULTURE AND DECLARED INCOME OF RS.1,09,000/- FROM THE BUSINESS OF FISH PONDS. IT WAS FURTHER NOTICED THAT THE ASSESSEE IS CULTIVATIN G THE PISCI CULTURE IN ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 3 THE LAND ADMEASURING 19 ACRES. THE USUAL RATE OF PR OFIT ADOPTED IN IDENTICAL CASES OF THIS AREA IS AROUND RS.30,000/- PER ACRE. HOWEVER, THE ASSESSEE HAS DECLARED AN INCOME OF LESS THAN RS .10,000/- PER ACRE. THE A.O. FURTHER OBSERVED THAT THE EXPENDITURE CLAI MED BY THE ASSESSEE IS NOT SUPPORTED BY ANY EVIDENCES. THEREFORE, REJE CTED THE BOOKS OF ACCOUNTS AND ESTIMATED THE INCOME OF RS.30,000/- PE R ACRE OF THE WATER SPREAD AREA OF 13.3 ACRES. SIMILARLY, THE A.O. NOT ICED THAT THE ASSESSEE IS EXECUTING WORKS CONTRACT AND ADMITTED A TOTAL IN COME OF RS.6,04,589/- ON GROSS CONTRACT RECEIPTS OF RS.5,02 ,96,000/-. THEREFORE ISSUED A SHOW CAUSE NOTICE AND ASKED TO JUSTIFY THE PROFIT SHOWN FROM THE CONTRACT BUSINESS. IN RESPONSE TO THE SHOW CAUS E NOTICE, THE ASSESSEE SUBMITTED THAT HE HAS UNDERTAKEN SUB CONTR ACT WORKS FROM M/S MAHABIR ENTERPRISES AND THE SCOPE OF WORK INVOLVES SEISMIC JOB SERVICES WHICH IS MAINLY LABOUR ORIENTED, THEREFORE, THE NET PROFIT MARGIN FROM THIS CONTRACT WORK IS VERY LESS. THE ASSESSEE FURT HER SUBMITTED THAT HE IS A THIRD LINE SUB CONTRACTOR AND TAKEN THE SUB CO NTRACT WORK FROM M/S. MOHABIR ENTERPRISES. TO SUPPORT HIS ARGUMENTS FURNI SHED A COPY OF MEMORANDUM OF UNDERSTANDING ENTERED INTO WITH M/S. MOHABIR ENTERPRISES. THE A.O. AFTER CONSIDERING THE SUBMIS SIONS OF THE ASSESSEE HELD THAT THE ASSESSEE IS NOT ABLE TO SUBSTANTIATE THE BOOK RESULTS WITH ANY EVIDENCES. THE A.O. FURTHER OBSERVED THAT MANY OF THE EXPENDITURE ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 4 SUPPORTED BY SELF VOUCHERS AND ALSO THE ASSESSEE HA S NOT ADVANCED ANY VALID REASONS FOR DECLARING LOW NET PROFIT. WITH TH ESE OBSERVATIONS, THE A.O. HAS REJECTED THE BOOKS OF ACCOUNTS AND ESTIMAT ED NET PROFIT OF 8% ON TOTAL CONTRACT RECEIPTS. WHILE DOING SO, THE A. O. HAS FOLLOWED THE RATIO OF THE JUDGEMENT OF HONBLE ITAT HYDERABAD `A BENCH DECISION IN THE CASE OF M/S. SRINIVASA LAKSHMI CONSTRUCTIONS VS . DCIT IN ITA 1347/HYD/2010 DATED 21.1.2011 AND ESTIMATED THE NET PROFIT OF 8% ON TOTAL CONTRACT RECEIPTS. 3. AGGRIEVED BY THE ASSESSMENT ORDER, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE CIT(A). BEFORE THE CIT(A), THE A SSESSEE REITERATED THE SUBMISSIONS MADE BEFORE THE ASSESSING OFFICER. AS REGARDS THE ESTIMATION OF INCOME FROM PISCI CULTURE, THE ASSESS EE SUBMITTED THAT THE INCOME DECLARED FROM THE BUSINESS OF PISCI CULTURE IS IN LINE WITH THE SIMILAR CASES IN THE LOCALITY. THE ASSESSEE FURTHE R SUBMITTED THAT HE IS CULTIVATING THE PISCI CULTURE IN THE LAND ADMEASURI NG 19 ACRES AND THE WATER SPREAD AREA IS ABOUT 70%. THEREFORE, THE INC OME DECLARED FROM THE BUSINESS OF PISCI CULTURE IS QUITE REASONABLE W HEN COMPARED TO THE AREA OF LAND PUT UP FOR CULTIVATION. IN SUPPORT OF HIS ARGUMENTS, FURNISHED A CERTIFICATE FROM THE VILLAGE OFFICER, W HEREIN IT HAS BEEN STATED THAT THE AVERAGE INCOME THAT COULD BE DERIVED FROM 1 ACRE OF FISH POND ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 5 WOULD BE AROUND RS.15,000/-. SIMILARLY, AS REGARDS THE ESTIMATION OF INCOME FROM CONTRACT BUSINESS, THE ASSESSEE SUBMITT ED THAT HE IS INTO THE BUSINESS OF CONTRACT WORK. IT IS FURTHER SUBMIT TED THAT HE HAD UNDERTAKEN SUB CONTRACT WORKS FROM M/S. MOHABIR ENT ERPRISES AND THE SCOPE OF WORK INVOLVES IS SEISMIC LABOUR. THE ASSES SEE FURTHER SUBMITTED THAT THE CASE LAW RELIED UPON BY THE A.O. WHILE EST IMATING THE INCOME AT 8% IS UNDER DIFFERENT CONTEXT. THE HONBLE ITAT HAS ESTIMATED THE INCOME OF 8% FROM THE BUSINESS OF EXECUTION OF CIVI L CONTRACTS, WHEREAS THE PRESENT SCOPE OF WORK IS PROVIDING LABOUR FOR E XECUTION OF CIVIL CONTRACT AND ALSO THE WORK INVOLVES IS MAINTENANCE OF CAMP OFFICE, TRANSPORTATION OF MATERIALS AND ALSO DISMANTLING TH E CAMP OFFICE. AS PER THE SCOPE OF WORK, THE MAIN WORKS INVOLVES PROVIDIN G 600 LABOURERS FOR SEISMIC SURVEY AND SHOOTING OF UPHOLES ON EXPERIMEN TAL BASIS. THEREFORE, THE WORKS INVOLVES DEPLOYMENT OF MORE LA BOUR AND ALSO HIRING OF MACHINERY. IT WAS FURTHER SUBMITTED THAT HE IS A THIRD LINE SUB CONTRACTOR WHEREIN THE MAIN CONTRACTOR M/S. ONGC LI MITED HAD GIVEN SUB CONTRACT TO M/S. ASIAN OIL FIELD SERVICES LTD., A GUJARAT BASED COMPANY. IN TURN, M/S. ASIAN OIL FIELD SERVICES LTD . HAS SUB CONTRACTED THE WORK TO M/S. MOHABIR ENTERPRISES AND M/S. MOHAB IR ENTERPRISES HAS GIVEN SUB CONTRACT TO ME. SINCE, MORE THAN 3 CONTR ACTORS ARE INVOLVED, ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 6 THE PROFIT ELEMENT IN THIS KIND OF CONTRACTS IS QUI TE LESS. THEREFORE, THE A.O. WAS NOT CORRECT IN ESTIMATING THE PROFIT OF 8% ON TOTAL TURNOVER. 4. THE CIT(A) AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE HELD THAT THE A.O. WAS NOT CORRECT IN ESTIMATING THE INC OME OF RS.30,000/- PER ACRE FROM THE BUSINESS OF FISH PONDS. THE CIT( A) FURTHER HELD THAT THE ASSESSEE HAS PRODUCED A CERTIFICATE FROM THE VI LLAGE OFFICER, WHEREIN IT HAS BEEN STATED THAT THE AVERAGE INCOME THAT COU LD BE DERIVED FROM 1 ACRE OF FISH POND IS AROUND RS.15,000/-. THE ASSESS ING OFFICER HAS NOT CONTRADICTED THE CERTIFICATE ISSUED BY THE VILLAGE OFFICER AND ALSO HAS NOT BROUGHT ON RECORD ANY MATERIAL TO SHOW THAT 1 ACRE OF FISH POND WOULD FETCH RS.30,000/-. WITH THESE OBSERVATIONS, DIRECTED THE A.O. TO ESTIMATE INCOME OF RS.15,000/- PER ACRE FROM THE BU SINESS OF FISH PONDS. SIMILARLY, AS REGARDS THE ESTIMATION OF INCO ME FROM CONTRACT RECEIPTS, THE CIT(A) HELD THAT THE ASSESSEE HAS ADM ITTED AN INCOME OF RS.6,04,589/- AS AGAINST THE GROSS RECEIPT OF RS.5, 04,05,000/- AND THE NET PROFIT WORKS OUT TO ABOUT 1.4%. THE CIT(A) FUR THER HELD THAT THOUGH THE NET PROFIT ADMITTED BY THE ASSESSEE IS LOW, THE A.O. WAS NOT JUSTIFIED IN ADOPTING NET PROFIT OF 8% BY FOLLOWING THE ITAT DECISION, WHICH WAS RENDERED IN THE CONTEXT OF EXECUTION OF CIVIL CONTR ACTS. THE ASSESSEE HAS INVOLVED IN THE BUSINESS OF SUPPLY OF LABOUR FOR EX ECUTION OF WORKS ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 7 CONTRACT. AS PER THE SCOPE OF WORK, THE ASSESSEE HA S UNDERTAKEN SEISMIC SURVEY AND SHOOTING, CAMP ESTABLISHMENT, CAMP MAINT ENANCE AND SURVEY AND PORTABLE OPERATION WHICH IS DIFFERENT FR OM NORMAL CIVIL WORKS. WITH THESE OBSERVATIONS, THE CIT(A) HAS SCALED DOWN THE ESTIMATION OF INCOME TO 2% ON TOTAL CONTRACT RECEIPTS. AGGRIEVED BY THE CIT(A) ORDER, THE REVENUE IS IN APPEAL BEFORE US. 5. THE LD. D.R. SUBMITTED THAT THE CIT(A) OUGHT TO HAVE CONFIRMED THE ESTIMATION OF INCOME FROM PISCI CULTURE AT RS.3 0,000/- PER ACRE, AS THE SAME WAS ON PAR WITH THE INCOME ADMITTED/DETERM INED IN ALL IDENTICAL CASES IN THE SAME JURISDICTION AND SUCH E STIMATION WAS ACCEPTED BY THE ASSESSEES. THE LD. D.R. SUBMITTED T HAT THOUGH ASSESSEE HAS DECLARED LESS THAN RS.10,000/- PER ACRE, HE HAS NOT SUBSTANTIATED THE NET PROFIT WITH ANY COGENT EVIDENCES. THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE ARE NOT SUPPORTED BY VAL ID EVIDENCES. THEREFORE, THE A.O. HAS REJECTED THE BOOKS OF ACCOU NTS AND ESTIMATED NET INCOME OF RS.30,000/- PER ACRE. THE LD. D.R. FU RTHER ARGUED THAT THE DEPARTMENT IS FOLLOWING A CONSISTENT METHOD OF ESTI MATING RS.30,000/- PER ACRE FROM THE BUSINESS OF FISH PONDS. IN SUPPO RT OF HIS ARGUMENT, FURNISHED A STATEMENT OF COMPARISON OF NET PROFIT D ECLARED BY OTHER ASSESSEES, WHEREIN THE NET PROFIT IS ABOUT RS.30,00 0/- PER ACRE. ON THE ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 8 OTHER HAND, THE LD. A.R. OF THE ASSESSEE STRONGLY S UPPORTED THE ORDER OF THE CIT(A). 6. WE HAVE HEARD BOTH THE PARTIES, PERUSED THE MATER IALS AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHOR ITIES BELOW. THE A.O. HAS ESTIMATED THE INCOME OF RS.30,000/- PER AC RE FROM THE BUSINESS OF FISH PONDS. THE A.O. WAS OF THE OPINIO N THAT THE BOOKS OF ACCOUNTS MAINTAINED BY THE ASSESSEE ARE NOT SUPPORT ED BY ANY EVIDENCES. THE ASSESSEE HAS NOT BROUGHT ON RECORD ANY COMPARABLE CASES TO JUSTIFY THE NET PROFIT DECLARED. IT IS TH E CONTENTION OF THE ASSESSEE THAT THE NET PROFIT ESTIMATED BY THE A.O. IS QUITE HIGH. THE ASSESSEE FURTHER CONTENDED THAT THE NORMAL INCOME P ER 1 ACRE OF PISCI CULTURE IN THE REGION IS BETWEEN RS.10,000/- TO RS. 15,000/-. IN SUPPORT OF HIS ARGUMENTS FURNISHED A CERTIFICATE ISSUED BY THE VILLAGE OFFICER, WHEREIN IT WAS CERTIFIED THAT PER ACRE OF FISH POND S WOULD FETCH AN INCOME OF RS.15,000/-. WE HAVE GONE THROUGH THE OR DERS OF THE LOWER AUTHORITIES AND ALSO DETAILS FURNISHED BY THE ASSES SEE. THE ASSESSEE SUBMITTED THAT PER ACRE OF FISH POND WOULD FETCH AN INCOME OF RS.15,000/-. THE A.O. HAS FURNISHED COMPARABLE CASE S, WHEREIN THE INCOME FROM FISH PONDS WOULD BE AROUND RS.30,000/-. ON PERUSAL OF THE STATEMENT FILED BY THE D.R., WE FIND THAT THE A.O. HAS ARRIVED AT AN ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 9 INCOME OF RS.30,000/- PER ACRE BY DIVIDING THE TOTA L INCOME ADMITTED BY THE ASSESSEES FROM WATER SPREAD AREA OF LANDS PUT U SE FOR CULTIVATION. ON FURTHER VERIFICATION OF THE STATEMENT FILED BY T HE D.R., WE FIND THAT THERE IS A DIFFERENCE BETWEEN EXTENT OF LAND USED F OR CULTIVATION AND LAND CONSIDERED BY THE A.O. TO ARRIVE AT AN INCOME OF RS . 30,000/-. WE FIND THAT THE A.O. HAS DIVIDED THE TOTAL INCOME FROM THE WATER SPREAD AREA. IT IS THE CONTENTION OF THE ASSESSEE THAT THE TOTAL INCOME SHOULD BE DIVIDED FROM THE TOTAL EXTENT OF LAND PUT USE FOR C ULTIVATION. AS PER THE STATEMENT FURNISHED BY THE D.R., THE TOTAL INCOME A DMITTED BY THE ASSESSEES IS DIVIDED BY THE TOTAL LAND PUT TO USE FOR CULTIVATION, THEN THE AVERAGE INCOME WORKS OUT TO RS.20,000/- TO RS.23,00 0/-. THEREFORE, WE ARE OF THE OPINION THAT THE A.O. IS NOT JUSTIFIED I N ESTIMATING INCOME OF RS. 30,000/- PER ACRE OF FISH PONDS. HENCE, TO MEET THE ENDS OF JUSTICE, WE DIRECT THE A.O. TO ESTIMATE INCOME OF RS.25,000/ - PER ACRE FROM THE BUSINESS OF FISH PONDS. 7. THE NEXT ISSUE CAME UP FOR OUR CONSIDERATION IS ESTIMATION OF INCOME FROM THE BUSINESS OF WORKS CONTRACTS. THE A. O. ESTIMATED THE INCOME OF 8% ON THE TOTAL CONTRACT RECEIPTS. THE A .O. WAS OF THE OPINION THAT THE BOOKS OF ACCOUNTS MAINTAINED BY TH E ASSESSEE ARE NOT SUSCEPTIBLE FOR VERIFICATION. IT WAS FURTHER OBSER VED BY THE A.O. THAT THE ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 10 ASSESSEE HAS NOT SUBSTANTIATED THE EXPENDITURE CLAI MED WITH ANY BILLS & VOUCHERS. IN THE ABSENCE OF NECESSARY EVIDENCES, T HE A.O. OPINED THAT THE BOOK RESULTS DECLARED BY THE ASSESSEE CANNOT BE ACCEPTED. WITH THESE OBSERVATIONS, THE A.O. HAS REJECTED THE BOOKS OF ACCOUNTS AND ESTIMATED THE NET PROFIT OF 8% BY RELYING UPON THE JUDGEMENT OF ITAT, HYDERABAD IN THE CASE OF M/S. SRINIVASA LAKSHMI CON STRUCTIONS VS. DCIT IN ITA 1347/HYD/2010 DATED 21.1.2011. IT IS THE CON TENTION OF THE ASSESSEE THAT HE IS INTO THE BUSINESS OF SUPPLY OF MAN POWER FOR EXECUTION OF WORKS CONTRACT. THE ASSESSEE FURTHER SUBMITTED THAT HE IS THE THIRD LINE SUB CONTRACTOR, WHEREIN THE CONTRACT WORK WAS AWARDED TO M/S. ONGC LIMITED, IN TURN THE ONGC LIMITED HAS SUB CONTRACTED THE WORK TO M/S. ASIAN OIL FIELD SERVICES LIMITED. M/S. ASIAN OIL FIELD SERVICES LTD. HAS SUB CONTRACTED THE WORK OF SEISMI C JOB SERVICES TO M/S. MOHABIR ENTERPRISES AND M/S MOHABIR ENTERPRISES HA S AWARDED THE WORK TO ME. IN SUPPORT OF HIS CONTENTIONS, FURNISHED A COPY OF MEMORANDUM OF UNDERSTANDING ENTERED INTO WITH M/S. MOHABIR ENT ERPRISES AND SUBMITTED THAT THE SCOPE OF WORK INVOLVES PROVIDING LABOUR FOR SHOOTING UPHOLES ON EXPERIMENTAL BASIS, MAINTENANCE OF CAMP OFFICE, ESTABLISHMENT OF CAMP OFFICE, DISMANTLING OF CAMP O FFICE AFTER THE COMPLETION OF WORK, THEREFORE, THE WORKS CARRIES MO RE MAN POWER THAN THE EXECUTION OF CIVIL CONTRACT. THEREFORE, THE A. O. WAS NOT CORRECT IN ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 11 ESTIMATING THE NET PROFIT OF 8%. WE FIND FORCE IN T HE ARGUMENTS OF THE ASSESSEE FOR THE REASON THAT ON PERUSAL OF THE MEMO RANDUM OF UNDERSTANDING FILED BY THE ASSESSEE, WE FIND THAT T HE ASSESSEE IS A THIRD LINE SUB CONTRACTOR EXECUTING WORKS FOR ANOTHER SUB CONTRACTOR. ON FURTHER VERIFICATION OF THE AGREEMENT, WE FIND THAT THE WORK INVOLVES SEISMIC JOB SERVICES, WHICH INVOLVES DEPLOYMENT OF MORE LABOUR. WE FURTHER OBSERVED THAT THE ASSESSEE NEEDS TO ESTABLI SH CAMP OFFICE, TRANSPORT MACHINERIES AND ALSO MAINTAIN CAMP OFFICE S, WHICH INVOLVES MORE LABOUR. THIS IS NOT A CIVIL CONTRACT TO APPLY THE NET PROFIT OF 8%. THE CASE LAWS RELIED UPON BY THE A.O. IS NOT APPLIC ABLE TO THE FACTS OF THE PRESENT CASE. MOREOVER, THE ASSESSEE IS A SUB CONTRACTOR, WHEREIN THE ELEMENT OF PROFIT IS ALWAYS LESS. THEREFORE, CO NSIDERING THE OVERALL FACTS AND CIRCUMSTANCES OF THE CASE, TO MEET THE EN DS OF JUSTICE, WE DIRECT THE A.O. TO ADOPT A NET PROFIT OF 4% ON TOTA L CONTRACT RECEIPTS. ACCORDINGLY, WE DIRECT THE A.O. TO ESTIMATE THE INC OME OF 4% ON TOTAL CONTRACT RECEIPTS. 8. IN THE RESULT, THE APPEAL FILED BY THE REVENUE I S PARTLY ALLOWED. 9. THE ASSESSEE HAS FILED A CROSS OBJECTION IN SUPP ORT OF ORDER OF THE CIT(A). THEREFORE, FOR THE REASONS RECORDED IN THE PRECEDING ITA NO.50/VIZAG/2013 U. GIRIDHAR KUMAR, KAIKALURU 12 PARAGRAPHS, WE DISMISS THE CROSS OBJECTION FILED BY THE ASSESSEE AS NOT MAINTAINABLE. 10. IN THE RESULT, THE APPEAL FILED BY THE REVENUE IS PARTLY ALLOWED AND THE CROSS OBJECTION FILED BY THE ASSESSEE IS DISMIS SED. THE ABOVE ORDER WAS PRONOUNCED IN THE OPEN COURT ON 29 TH APR16. SD/- SD/- ( . ) ( . ) (V. DURGA RAO) (G. MANJUNATHA) /JUDICIAL MEMBER /ACCOUNTANT MEMBER # /VISAKHAPATNAM: ' /DATED : 29.04.2016 VG/SPS )# *# /COPY OF THE ORDER FORWARDED TO:- 1. / THE APPELLANT THE ITO WARD-1, GUDIVADA 2. / THE RESPONDENT SRI UPPALAPATI GIRIDHAR KUMAR, DR.NO.3-40, LOKAMUDIGARUVU, KAIKALURU. 3. + / THE CIT, VIJAYAWADA 4. + ( ) / THE CIT (A), VIJAYAWADA 5. # . , . , # / DR, ITAT, VISAKHAPATNAM 6 . / GUARD FILE / BY ORDER // TRUE COPY // 12 . (SR.PRIVATE SECRETARY) . , # / ITAT, VISAKHAPATNAM