COMMISSIONER OF INCOME TAX Vs. AZAD BUILDERS

JUDGEMENT

(1.) This is a reference under Sec. 256(2) of the Income -tax Act, 1961 ('the Act'). The questions called for on reference to this Court are as follows:

(2.) On appeal, the AAC held that out of the gross sum received by the assessee, Rs. 3,96,132 constitutes the cost of materials supplied by the Irrigation Department, Heavy Engg. Corpn. Ranchi and Ranchi University for whom the assessee has executed the work. In the view of the AAC, the rate of net profit should have been assessed on the basis of the net receipt and not on gross receipt. The view of the AAC was upheld by the Tribunal.

(3.) The revenue was not satisfied with the verdict of the Tribunal. An application under Sec. 256(1) having failed the petitioner moved this Court, on which, a reference was called for and the present reference has been received in the said circumstance.