Net profit ratio of 3 percent in contract business allowed as in earlier years even lower profit rate was consistently accepted without objection-ITAT

Net profit ratio of 3 percent in contract business allowed as in earlier years even lower profit rate was consistently accepted without objection by the Department – ITAT

Net profit ratio

ABCAUS Case Law Citation:
ABCAUS 1225 (2017) (04) ITAT

The Grievance:
The appellant assessee was aggrieved by the order passed by the Commissioner of Income Tax (Appeals) in confirming the order of the Assessing Officer (AO) in estimating the profit of his contact business at 8% of the total turnover.

Assessment Year : 2010-11
Date/Month of Pronouncement: April, 2017

Brief Facts of the Case:
The assessee was an individual engaged in the business of contract work. For the relevant year, the AO observed that the books of account of the assessee were not reliable as such he assessed the income of the assessee at by estimating the profit at 8% of the total turnover.

The appeal preferred by the assessee before the CIT(A) was dismissed.

Aggrieved by the same the assessee is in appeal before us challenging the rejection of books of account and estimation of profit at 8% of contract receipts.

Contentions of the appellant assessee:
It was submitted that in respect of the earlier years were namely 2000-01, 2003-04, 2006-07, 2007-08 and 2009-10 assessment was completed u/s 143(3) of the Income Tax Act, 1961 (‘the Act’) accepting the profit ratio as under:

Ass. Year Net Profit %
AY 2000-01 3.31%
AY 2003-04 1.60
AY 2006-07 2.63
AY 2007-08 2.39
AY 2008-09 2.30
AY 2009-10 2.46

It was prayed that in view of the above it was not open for the Revenue now to straightaway estimate the profit ratio at 8%. He prayed that profit ratio be  estimated at 2.46% which was accepted in the immediately preceding AY 2009-10.

Contention of the Respondent Revenue:
It was the argument of the Revenue that the AO had given the cogent reasons for rejection of the books and estimation of 8% of the profit ratio. He submitted that the profit ratio suggested by the assessee at 2.46% was too low and could not be accepted. It was prayed that at the lowest the profit ratio could be around 4%.

Observations made by the Tribunal:
The Tribunal observed that as pointed out, for many years, the Income Tax Department consistently accepted the profit ratio in the business of the assessee which was between 1.60 and 3.31 and at no point of time any objection was taken by the AO on the ground that in the kind of business of the assessee average rate of profit would be anything around 8%.

The Tribunal opined that under the circumstances, it did not find any rational in the AO estimating the profit at 8% and the consistency of the net profit as was established by the accepted books of account in the business of the assessee was something between 1.60% and 3.31% therefore taking a pragmatic view, 3% of the profit ratio of the contract receipt would meet the ends of justice.

Held:
AO was directed to estimate the profit of the assessee at 3% of the total turnover.

Net profit ratio
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Ban on publishing Aadhaar number and demographic details along with other Personal sensitive information

Ban on publishing Aadhaar number and demographic details along with other Personal sensitive information in contravention of Aadhaar Act, 2016 or IT Act, 2000

Ban on publishing Aadhaar number

F. No. 402/14/2017-ITCC
Government of lndia
Ministry of Finance
Department of Revenue
Central Board of Direct Taxes
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North Block, New Delhi,
Dated 25th April, 2017

OFFICE MEMORANDUM

Subject:- Data Sharing-Compliance·of the IT Act, 2000 and Aadhaar Act, 2016.

The undersigned is directed to forward herewith a copy of Communication No: 10(36)/2015-EG II(Vol.V) dated 25.03.2017 received from Joint Secretary, Ministry of Electronics & Information Technology along with a copy of OM dated 25.03.2017 (of e-Governance Group, Ministry of Electronics & lnformation Technology on the above mentioned subject.

It is requested  that any  act of publishing personal identity or information i.e. Aadhaar number and demographic details along with personal sensitive information such as bank details, in-contravention of the Aadhaar Act, 2016 and the Information Technology Act, 2000 be refrained with immediate effect. Further, any such content already published and still appearing publicly be discontinued with immediate effect.

Further, it is requested to ensure that these instructions are brought to the notice of all concerned for immediate compliance It is also requested to furnish a report of compliance w.r.t. the e-Govemance Group’s OM dated 25.03.2017 to this Division at the earliest for onward transmission to them.

Encl: as above

(Sarojini Rawat)
Under Secretary to the Govt. of lndia
Tel. 23095461

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MSEFC Portal and Mobile App MyMSME launched. Delayed Payment Cases Brought On Portal

MSEFC Portal and Mobile App MyMSME launched. 3700 Delayed Payment Cases Involving an Amount of Rs. 1650 Crore Brought On Portal

MSEFC Portal and Mobile App  

Ministry of Micro,Small & Medium Enterprises

27-April, 2017

Shri Venkaiah Naidu Launches Micro and Small Enterprise Facilitation Council (MSEFC) Portal and MyMSME Mobile App

Delayed Payment Cases & MSME Schemes Brought Online

3700 Delayed Payment Cases Involving an Amount of Rs. 1650 Crore Brought On Portal

Shri M. Venkaiah Naidu, Union Minister for Urban Development, Housing & Urban Poverty Alleviation and Union Minister for Information & Broadcasting launched two important initiatives of the Ministry of Micro, Small and Medium Enterprises (Ministry of MSME), viz. Micro and Small Enterprises Facilitation Council (MSEFC) portal and MyMSME Mobile App on the occasion of the 15th Meeting of the National Board for MSME here today. Union Minsiter for MSME Shri Kalraj Mishra, Minister of State for MSME Shri Giriraj Singh and Minister of State for MSME Shri Haribhai Parthibhai Chaudhary were present on this august occasion. 

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The Union Minister for Urban Development, Housing & Urban Poverty Alleviation and Information & Broadcasting, Shri M. Venkaiah Naidu launching the MyMSME App and MSME Facilitation Council (NMSEFC) Portal, at the Meeting of National Board for MSME to discuss the agenda of 15th Meeting of NBMSME, in New Delhi on April 27, 2017. The Union Minister for Micro, Small and Medium Enterprises, Shri Kalraj Mishra and the Minister of State for Micro, Small and Medium Enterprises, Shri Haribhai Parthibhai Chaudhary are also seen.

 

 

 

 

 

 

Shri Kalraj Mishra, speaking on the occasion, said that Micro and Small Enterprises Facilitation Council (MSEFC) portal on http://msefc.msme.gov.in, would facilitate implementation of the delayed payment provisions of the MSMED Act 2006 and also assist in monitoring of delayed payment cases. This online platform is expected to be a significant step in the direction of Digital India from the perspective of the MSME Sector in the country. With the access to this platform, micro and small enterprises would be able to file their delayed payment related grievances online. The grievance filed would be communicated through email and SMS to the parties involved. It would also help officers of the Ministry of MSME as well as the State Government concerned in monitoring the progress of cases both at the State and National levels. He also informed that most of the States have already uploaded the information regarding delayed payment cases on MSEFC portal. As on 31.03.2017, 3690 cases involving an amount of Rs.1660 crore are being considered by various MSEFCs. In fact, the online portal would be of great help to start-ups since delayed payment is probably the single biggest problem for start-ups.

In addition, the MyMSME mobile app on http://my.msme.gov.in, also launched by Shri M. Venkaiah Naidu, provides information on all schemes implemented by the Ministry of MSME at one place. The MSME units have had always been complaining that information on all schemes were not available at a single place. Such a compilation is certainly the need of the hour so as to ensure that entrepreneurs need not be searching multiple windows for help or information. With the help of MyMSME mobile app Ministry of MSME would be providing one single window to MSMEs to access information on all schemes implemented by the Ministry and as well as apply for any of them. And MSMEs can also lodge grievances pertaining to Ministry of MSME through this app. 

 

Prime Minister has recently spoken about the need for moving forward to M-Governance (Mobile Governance) from e-Governance, on the occasion of the Civil Services Day celebrations. This mobile app has enabled the MSME Sector to usher in the era of M-Governance.

MSEFC Portal and Mobile App

Union Minister of State for MSME Shri Haribhai Choudhary stated that the Ministry has embarked on the journey to make every scheme online.  He stated that MSME Internet grievance monitoring system has already resolved the grievances of more than 3000 persons. 

Shri Venkaiah Naidu, Hon’ble Union Minister for Urban Development, Housing & Urban Poverty Alleviation and Information & Broadcasting appreciated the efforts of the Minister in taking various initiatives towards ease of doing business in the MSME Sector in the country. He also congratulated Shri Kalraj Mishraji for taking steps in line with Prime Minister’s Digital India mission.

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