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5.3 The matter, it needs to be appreciated, is primarily factual. The absence of quantitative details, correlating it with the project parameters, is a serious structural defect in the assessee's accounts. The accounts cannot, for that reason, it needs to be appreciated, lead to correct cost determination and, thus, the true operating results of the business. Apart from direct cost (of construction), we do not think that any serious objection has been raised by the Revenue qua the other costs, i.e., specifically speaking; the minor defects not warranting a resort to s. 145(3). We emphasize on cost as the Revenue has not expressed any doubt with regard to suppression of receipt in the present case. The extremely low profit rate/s - with, excluding the 'other income' resulting in a loss (negative profit), for which there could be valid reason/s, has to have its' explanation in the assessee's accounts. And which are presumed to be correct and complete, faithfully recording the transactions as well as the valuations of various assets and liabilities, unless they are shown to be not so and, therefore, the said explanation/s not forthcoming there- from. The onus in this regard is on the Revenue. We have, on the balance, found Hafiz Construction Co. Pvt. Ltd. v. ITO the assessee's accounts to be not shown by it to be not correct and complete except to the extent and in-so-far as they do not exhibit or record the basis for the claim of the material cost, nor indeed the basis of valuation of inventory, with the opening and closing inventory (of WIP) being, rather queerly, (almost) the same. We, therefore, upholding the rejection of accounts, under the circumstances, consider it proper that the matter is restored back to the file of the AO to enable the assessee an opportunity to justify its' operating results with reference to the material cost. If there is, as normally obtains, a correspondence between material and labor costs, the two would though require being considered in tandem. The opening and closing WIP, valuation of which is also to be validated (refer: British Paints India Ltd. (supra)), may also stand to be corroborated by other relevant materials and surrounding circumstances viz., the running account/s with the contractee/s, which is normally prepared before raising any bill; the periodic reports generated, etc. The AO shall adjudicate per a speaking order, issuing definite findings of fact, after allowing the assessee a reasonable opportunity of being heard. We may clarify that we would have, rather than remitting the matter, ourselves applied the profit rate of 6.5% (on contract receipt), i.e., as proposed by the assessee during assessment proceedings. The only consideration that prevails with us, constraining us from doing so, is that the assessee's accounts have been found as not reliable principally with regard to material cost, so that it is the gross (trading) margin that ought to have been and, accordingly, is to be estimated and applied. The Revenue has not expressed any serious doubt in respect of the indirect costs, and which would therefore stand to be allowed as claimed, of course subject to any statutory disallowance/s, if any. The AO shall base his decision on all relevant materials, duly confronting the assessee therewith, as also apply separate profit rates on contract receipt and pipe sales, i.e., in case the trading profit on the latter is also not, as appears to be, determinable with reference to the books of account. The Hafiz Construction Co. Pvt. Ltd. v. ITO assessee's results for the preceding years, subject of course to the impact of the changes in input and output prices, would also be relevant where the relevant accounts are not similarly imbued with defect/s as found for the current year.