- (1.) C. M. No. 1817-C-II of 2016 : Through this application, condonation of delay of 183 days in re-filing the present appeal is sought for. Allowed as prayed for. CM stands disposed of. Main Appeal : An order dated 15.12.2015, passed by the Income Tax Appellate Tribunal, Division Bench, Chandigarh (hereinafter referred to as the Tribunal) in MA No. 54/CHD/2015 in ITA No. 188/CHD/2014 was handed over to us by learned counsel appearing on behalf of the appellant in Court today. The same is ordered to be taken on record as Mark-A.
(2.) The present is an appeal by the Revenue under Section 260-A of the Income Tax Act, 1961 (hereinafter referred to as the Act) impugning therein the order passed by the Tribunal dated 15.07.2014 (Annexure A-3). At the time of hearing of the matter, the afore-referred order dated 15.12.2015 (Mark-A) was produced and also assailed. The present appeal pertains to the assessment year 2010-11 and seeks to raise the following substantial questions of law :- "1. Whether in the facts and circumstances of the case, the ITAT was right in law in directing the AO to apply the gross profit rate of 7% instead of 10% adopted by the AO, without appreciating the numerous and substantial deficiencies in the accounts pointed by the AO and that the rate of net profit of 10% was held to be reasonable in the case of CIT vs. M/s Shivam Construction Co. in ITA No. 167 of 2007 dated 07.05.2007 subject to allowing of interest and salary to the partners and disallowing the depreciation 2. Whether in the facts and circumstances of the case, the ITAT was right in law in allowing the depreciation claimed whereas the Hon'ble Punjab and Haryana High Court, Chandigarh has held in the case of Surinder Pal Nayyar vs. CIT, Ludhiana reported in 177 Taxmann 207 that the profit having been arrived at on the basis of gross receipts by taking into consideration all allowable expenses, no deduction on account of depreciation can be separately allowed. -
(3.) The factual matrix of the matter, which, in brevity needs to be noticed is that the respondent-assessee is a Civil Contractor. After he had filed his return for the assessment year in question, his case was selected for scrutiny and in the proceedings which ensued, since according to the Assessing Officer, proper books of accounts were not produced by him, while rejecting his books of accounts, the Assessing Officer ordered that the assessee be assessed to tax after application of Net Profit Rate of 10%. No deduction on account of depreciation was allowed.;