Double Deduction of Expenditure

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This query is : Resolved

rajesh chanda sharma (Querist)
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14 November 2010 Dear all
one of my client doing civil contract business deduct one head of expenditure twice once it has deducted from gross receipt and secondly debited to income expenditure account,the amount of diff is about 3.5 lacs and N.P. Ratio is 4.5 % the A.O.wants to tax whole amount to taxed while assessee proposing to tax the amount at 4.5 % or even higher at 8%

Does he have any rescue,pl. guide
R.C. Sharma
Siddharthnagar

CA PARAS BAFNA

CA PARAS BAFNA (Expert)
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14 November 2010 Dear Sharmaji,

If NP is 4.5% then the Gross Receipts would be exceeding Rs. 40.00 lacs or the accounts of the client were supposed to be prepared and get audited.

The ITO in this situation is right in making the addition of the amount which has been excessively claimed.

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