1. IN THE INCOME TAX APPELALTE TRIBUNAL: JODHPUR BENCH : JODHPUR
BEFORE SHRI HARI OM MARATHA, JUDICIAL MEMBER AND
SHRI N.K. SAINI, ACCOUNTANT MEMBER.
ITA No. 418/JU/2008
[A.Y: 2004-05]
The A.C.I.T Vs. M/s Gopal Ram Pema Ram
Circle – 2 Karmisar
Bikaner Bikaner
PAN No: AABFG 1491 J
(Appellant) (Respondent)
Assessee by : Shri Suresh Ojha
Department By : Shri N.A. Joshi - D.R.
Date of hearing : 12/06/2014.
Date of pronouncement : 15/07/2014.
O R D E R
PER HARI OM MARATHA, J.M
This is an appeal by the assessee directed against the order dated
19/03/2006 of ld. CIT(A), Bikaner.
2. The following sole ground has been raised in this appeal:
“On the facts and in the circumstances of the case, the ld.
CIT(A) has erred in directing to apply net profit rate of 8.48%
before allowing claim for depreciation, interest &
remuneration to partners and interest paid to third parties

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as against net profit rate applied by the A.O. at 10.5%
subject to depreciation and interest and remuneration paid
to the partners when provisions of sec. 145 of the Act, are
clearly applicable and also not disputed by the assessee.”
3. Briefly stated, the facts of the case are that the assessee is a
partnership firm deriving its income from execution of contract work
undertaken from Government department. The books of account were
rejected u/s 145(3) of the Income-tax Act, 1961 ['the Act', for short]
and net profit rate was applied. The Tribunal has also confirmed the
application of provisions of section 145(3) of the Act but the assessee
had claimed interest paid to third parties while estimating profit under
this section. This issue was stated to be covered by the decision of
this very Bench rendered in the case of M/s Ganesh Garhia
Construction Co. Vs. ACIT for A.Y. 2004-05 in ITA No.
430/Jodhpur/2008 which was also corrected/rectified vide MA No.
04/JU/2013 vide order dated 02.05.2014. Accordingly, the order
passed by the Tribunal on 31.12.2008 in this case was recalled and only
to that extent the appeal was heard. The issue of payment of interest
to third parties being clearly covered by the Tribunal order and their
consistent view, we modify the order accordingly by making
observation that after invoking provisions of section 145(3) of the Act
in this case, interest paid to third parties is also allowable.

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Accordingly, result of the appeal shall remain same i.e. appeal shall be
partly allowed.
4. In the result, appeal of the assessee is partly allowed.
(Order Pronounced in the Court on 15th
July, 2014).
Sd/- Sd/-
(N.K.SAINI) (HARI OM MARATHA)
ACCOUNTANT MEMBER JUDICIAL MEMBER
Dated : 15th
July, 2014.
VL/
Copy to:
1. The Appellant
2. The Respondent
3. The ld.CIT
4. The CIT(A)
5. The D.R
Assistant Registrar,
ITAT, Jodhpur.