diff --git a/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/__init__.py b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/__init__.py
new file mode 100644
index 0000000..e69de29
--- /dev/null
+++ b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/__init__.py
diff --git a/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.js b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.js
new file mode 100644
index 0000000..b11a1fc
--- /dev/null
+++ b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.js
@@ -0,0 +1,48 @@
+// Copyright (c) 2016, Frappe Technologies Pvt. Ltd. and contributors
+// For license information, please see license.txt
+/* eslint-disable */
+
+frappe.query_reports["Employee Hours Utilization Based On Timesheet"] = {
+	"filters": [
+		{
+			fieldname: "company",
+			label: __("Company"),
+			fieldtype: "Link",
+			options: "Company",
+			default: frappe.defaults.get_user_default("Company"),
+			reqd: 1
+		},
+		{
+			fieldname: "from_date",
+			label: __("From Date"),
+			fieldtype: "Date",
+			default: frappe.defaults.get_global_default("year_start_date"),
+			reqd: 1
+		},
+		{
+			fieldname:"to_date",
+			label: __("To Date"),
+			fieldtype: "Date",
+			default: frappe.defaults.get_global_default("year_end_date"),
+			reqd: 1
+		},
+		{
+			fieldname: "employee",
+			label: __("Employee"),
+			fieldtype: "Link",
+			options: "Employee"
+		},
+		{
+			fieldname: "department",
+			label: __("Department"),
+			fieldtype: "Link",
+			options: "Department"
+		},
+		{
+			fieldname: "project",
+			label: __("Project"),
+			fieldtype: "Link",
+			options: "Project"
+		}
+	]
+};
diff --git a/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.json b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.json
new file mode 100644
index 0000000..5ff8186
--- /dev/null
+++ b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.json
@@ -0,0 +1,22 @@
+{
+ "add_total_row": 0,
+ "columns": [],
+ "creation": "2021-04-05 19:23:43.838623",
+ "disable_prepared_report": 0,
+ "disabled": 0,
+ "docstatus": 0,
+ "doctype": "Report",
+ "filters": [],
+ "idx": 0,
+ "is_standard": "Yes",
+ "modified": "2021-04-05 19:23:43.838623",
+ "modified_by": "Administrator",
+ "module": "Projects",
+ "name": "Employee Hours Utilization Based On Timesheet",
+ "owner": "Administrator",
+ "prepared_report": 0,
+ "ref_doctype": "Timesheet",
+ "report_name": "Employee Hours Utilization Based On Timesheet",
+ "report_type": "Script Report",
+ "roles": []
+}
\ No newline at end of file
diff --git a/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.py b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.py
new file mode 100644
index 0000000..48eb7b4
--- /dev/null
+++ b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/employee_hours_utilization_based_on_timesheet.py
@@ -0,0 +1,259 @@
+# Copyright (c) 2013, Frappe Technologies Pvt. Ltd. and contributors
+# For license information, please see license.txt
+
+from __future__ import unicode_literals
+import frappe
+from frappe import _
+from frappe.utils import flt, getdate
+from six import iteritems
+
+def execute(filters=None):
+	return EmployeeHoursReport(filters).run()
+
+class EmployeeHoursReport:
+	'''Employee Hours Utilization Report Based On Timesheet'''
+	def __init__(self, filters=None):
+		self.filters = frappe._dict(filters or {})
+
+		self.from_date = getdate(self.filters.from_date)
+		self.to_date = getdate(self.filters.to_date)
+
+		self.validate_dates()
+	
+	def validate_dates(self):
+		self.day_span = (self.to_date - self.from_date).days
+
+		if self.day_span <= 0:
+			frappe.throw(_('From Date must come before To Date'))
+
+	def run(self):
+		self.generate_columns()
+		self.generate_data()
+		self.generate_report_summary()
+		self.generate_chart_data()
+
+		return self.columns, self.data, None, self.chart, self.report_summary
+
+	def generate_columns(self):
+		self.columns = [
+			{
+				'label': _('Employee'),
+				'options': 'Employee',
+				'fieldname': 'employee',
+				'fieldtype': 'Link',
+				'width': 230
+			},
+			{
+				'label': _('Department'),
+				'options': 'Department',
+				'fieldname': 'department',
+				'fieldtype': 'Link', 
+				'width': 170
+			},
+			{
+				'label': _('Total Hours'),
+				'fieldname': 'total_hours',
+				'fieldtype': 'Float',
+				'width': 150
+			},
+			{
+				'label': _('Billed Hours'),
+				'fieldname': 'billed_hours',
+				'fieldtype': 'Float',
+				'width': 150
+			},
+			{
+				'label': _('Non-Billed Hours'),
+				'fieldname': 'non_billed_hours',
+				'fieldtype': 'Float',
+				'width': 150
+			},
+			{
+				'label': _('Untracked Hours'),
+				'fieldname': 'untracked_hours',
+				'fieldtype': 'Float',
+				'width': 150
+			},
+			{
+				'label': _('% Utilization (Billed Hours + Non-Billed Hours / Total Hours)'),
+				'fieldname': 'per_util',
+				'fieldtype': 'Percentage',
+				'width': 200
+			}
+		]
+	
+	def generate_data(self):
+		self.generate_filtered_time_logs()
+		self.generate_stats_by_employee()
+		self.set_employee_department_and_name()
+
+		if self.filters.department:
+			self.filter_stats_by_department()
+
+		self.calculate_utilizations()
+
+		self.data = []
+
+		for emp, data in iteritems(self.stats_by_employee):
+			row = frappe._dict()
+			row['employee'] = emp
+			row.update(data)
+			self.data.append(row)
+
+		#  Sort by descending order of percentage utilization
+		self.data.sort(key=lambda x: x['per_util'], reverse=True)
+
+	def filter_stats_by_department(self):
+		filtered_data = frappe._dict()
+		for emp, data in self.stats_by_employee.items():
+			if data['department'] == self.filters.department:
+				filtered_data[emp] = data
+		
+		# Update stats
+		self.stats_by_employee = filtered_data
+
+	def generate_filtered_time_logs(self):
+		additional_filters = ''
+
+		filter_fields = ['employee', 'project', 'company']
+
+		for field in filter_fields:
+			if self.filters.get(field):
+				if field == 'project':
+					additional_filters += f"AND ttd.{field} = '{self.filters.get(field)}'"
+				else:
+					additional_filters += f"AND tt.{field} = '{self.filters.get(field)}'"
+
+		self.filtered_time_logs = frappe.db.sql('''
+			SELECT tt.employee AS employee, ttd.hours AS hours, ttd.billable AS billable, ttd.project AS project
+			FROM `tabTimesheet Detail` AS ttd 
+			JOIN `tabTimesheet` AS tt 
+				ON ttd.parent = tt.name
+			WHERE tt.employee IS NOT NULL
+			AND tt.start_date BETWEEN '{0}' AND '{1}'
+			AND tt.end_date BETWEEN '{0}' AND '{1}'
+			{2}
+		'''.format(self.filters.from_date, self.filters.to_date, additional_filters))
+
+	def generate_stats_by_employee(self):
+		self.stats_by_employee = frappe._dict()
+
+		for emp, hours, billable, project in self.filtered_time_logs:
+			self.stats_by_employee.setdefault(
+				emp, frappe._dict()
+			).setdefault('billed_hours', 0.0)
+
+			self.stats_by_employee[emp].setdefault('non_billed_hours', 0.0)
+
+			if billable:
+				self.stats_by_employee[emp]['billed_hours'] += flt(hours, 2)
+			else:
+				self.stats_by_employee[emp]['non_billed_hours'] += flt(hours, 2)
+
+	def set_employee_department_and_name(self):
+		for emp in self.stats_by_employee:
+			emp_name = frappe.db.get_value(
+				'Employee', emp, 'employee_name'
+			)
+			emp_dept = frappe.db.get_value(
+				'Employee', emp, 'department'
+			)
+
+			self.stats_by_employee[emp]['department'] = emp_dept
+			self.stats_by_employee[emp]['employee_name'] = emp_name
+		
+	def calculate_utilizations(self):
+		# (9.0) Will be fetched from HR settings
+		TOTAL_HOURS = flt(9.0 * self.day_span, 2)
+		for emp, data in iteritems(self.stats_by_employee):
+			data['total_hours'] = TOTAL_HOURS
+			data['untracked_hours'] = flt(TOTAL_HOURS - data['billed_hours'] - data['non_billed_hours'], 2)
+
+			# To handle overtime edge-case
+			if data['untracked_hours'] < 0:
+				data['untracked_hours'] = 0.0
+				
+			data['per_util'] = flt(((data['billed_hours'] + data['non_billed_hours']) / TOTAL_HOURS) * 100, 2)
+	
+	def generate_report_summary(self):
+		self.report_summary = []
+
+		if not self.data:
+			return 
+
+		avg_utilization = 0.0
+		total_billed, total_non_billed = 0.0, 0.0
+		total_untracked = 0.0
+
+		for row in self.data:
+			avg_utilization += row['per_util']
+			total_billed += row['billed_hours']
+			total_non_billed += row['non_billed_hours']
+			total_untracked += row['untracked_hours']
+
+		avg_utilization /= len(self.data)
+		avg_utilization = flt(avg_utilization, 2)
+
+		THRESHOLD_PERCENTAGE = 70.0
+		self.report_summary = [
+			{
+				'value': f'{avg_utilization}%',
+				'indicator': 'Red' if avg_utilization < THRESHOLD_PERCENTAGE else 'Green',
+				'label': _('Average Utilization'),
+				'datatype': 'Percentage'
+			},
+			{
+				'value': total_billed,
+				'label': _('Total Billed Hours'),
+				'datatype': 'Float'
+			},
+			{
+				'value': total_non_billed,
+				'label': _('Total Non-Billed Hours'),
+				'datatype': 'Float'
+			},
+			{
+				'value': total_untracked,
+				'label': _('Total Untracked Hours'),
+				'datatype': 'Float'
+			}
+		]
+
+	def generate_chart_data(self):
+		self.chart = {}
+
+		labels = []
+		billed_hours = []
+		non_billed_hours = []
+		untracked_hours = []
+
+
+		for row in self.data:
+			labels.append(row.get('employee_name'))
+			billed_hours.append(row.get('billed_hours'))
+			non_billed_hours.append(row.get('non_billed_hours'))
+			untracked_hours.append(row.get('untracked_hours'))
+		
+		self.chart = {
+			'data': {
+				'labels': labels[:30],
+				'datasets': [
+					{
+						'name': _('Billed Hours'),
+						'values': billed_hours[:30]
+					},
+					{
+						'name': _('Non-Billed Hours'),
+						'values': non_billed_hours[:30]
+					},
+					{
+						'name': _('Untracked Hours'),
+						'values': untracked_hours[:30]
+					}
+				]
+			},
+			'type': 'bar',
+			'barOptions': {
+				'stacked': True
+			}
+		}
diff --git a/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/test_employee_util.py b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/test_employee_util.py
new file mode 100644
index 0000000..977a10d
--- /dev/null
+++ b/erpnext/projects/report/employee_hours_utilization_based_on_timesheet/test_employee_util.py
@@ -0,0 +1,192 @@
+from __future__ import unicode_literals
+import unittest
+import frappe
+
+from frappe.utils.make_random import get_random
+from erpnext.projects.report.employee_hours_utilization_based_on_timesheet.employee_hours_utilization_based_on_timesheet import execute
+from erpnext.hr.doctype.employee.test_employee import make_employee
+from erpnext.projects.doctype.project.test_project import make_project
+
+class TestEmployeeUtilization(unittest.TestCase):
+    @classmethod
+    def setUpClass(cls):
+        # Create test employee
+        cls.test_emp1 = make_employee("test1@employeeutil.com", "_Test Company")
+        cls.test_emp2 = make_employee("test2@employeeutil.com", "_Test Company")
+
+        # Create test project
+        cls.test_project = make_project({"project_name": "_Test Project"})
+
+        # Create test timesheets
+        cls.create_test_timesheets()
+
+    @classmethod
+    def create_test_timesheets(cls):
+        timesheet1 = frappe.new_doc("Timesheet")
+        timesheet1.employee = cls.test_emp1
+        timesheet1.company = '_Test Company'
+
+        timesheet1.append("time_logs", {
+            "activity_type": get_random("Activity Type"),
+            "hours": 5,
+            "billable": 1,
+            "from_time": '2021-04-01 13:30:00.000000',
+            "to_time": '2021-04-01 18:30:00.000000'
+        })
+
+        timesheet1.save()
+        timesheet1.submit()
+
+        timesheet2 = frappe.new_doc("Timesheet")
+        timesheet2.employee = cls.test_emp2
+        timesheet2.company = '_Test Company'
+
+        timesheet2.append("time_logs", {
+            "activity_type": get_random("Activity Type"),
+            "hours": 10,
+            "billable": 0,
+            "from_time": '2021-04-01 13:30:00.000000',
+            "to_time": '2021-04-01 23:30:00.000000',
+            "project": cls.test_project.name
+        })
+
+        timesheet2.save()
+        timesheet2.submit()  
+
+    @classmethod
+    def tearDownClass(cls):
+        # Delete time logs
+        frappe.db.sql("""
+            DELETE FROM `tabTimesheet Detail`
+            WHERE parent IN (
+                SELECT name 
+                FROM `tabTimesheet` 
+                WHERE company = '_Test Company'
+            )
+        """)
+
+        frappe.db.sql("DELETE FROM `tabTimesheet` WHERE company='_Test Company'")
+        frappe.db.sql(f"DELETE FROM `tabProject` WHERE name='{cls.test_project.name}'")
+
+    def test_utilization_report_with_required_filters_only(self):
+        filters = {
+            "company": "_Test Company",
+            "from_date": "2021-04-01",
+            "to_date": "2021-04-03" 
+        }
+
+        report = execute(filters)
+
+        expected_data = self.get_expected_data_for_test_employees()
+        self.assertEqual(report[1], expected_data)
+    
+    def test_utilization_report_for_single_employee(self):
+        filters = {
+            "company": "_Test Company",
+            "from_date": "2021-04-01",
+            "to_date": "2021-04-03",
+            "employee": self.test_emp1
+        }
+
+        report = execute(filters)
+
+        emp1_data = frappe.get_doc('Employee', self.test_emp1)
+        expected_data = [
+            {
+                'employee': self.test_emp1, 
+                'employee_name': emp1_data.employee_name,
+                'department': emp1_data.department,
+                'billed_hours': 5.0, 
+                'non_billed_hours': 0.0, 
+                'total_hours': 18.0, 
+                'untracked_hours': 13.0, 
+                'per_util': 27.78
+            }
+        ]
+
+        self.assertEqual(report[1], expected_data)
+
+    def test_utilization_report_for_project(self):
+        filters = {
+            "company": "_Test Company",
+            "from_date": "2021-04-01",
+            "to_date": "2021-04-03",
+            "project": self.test_project.name
+        }
+
+        report = execute(filters)
+        
+        emp2_data = frappe.get_doc('Employee', self.test_emp2)
+        expected_data = [
+            {
+                'employee': self.test_emp2,
+                'employee_name': emp2_data.employee_name,
+                'department': emp2_data.department,
+                'billed_hours': 0.0, 
+                'non_billed_hours': 10.0, 
+                'total_hours': 18.0, 
+                'untracked_hours': 8.0, 
+                'per_util': 55.56
+            }
+        ]
+
+        self.assertEqual(report[1], expected_data)
+
+    def test_utilization_report_for_department(self):
+        emp1_data = frappe.get_doc('Employee', self.test_emp1)
+        filters = {
+            "company": "_Test Company",
+            "from_date": "2021-04-01",
+            "to_date": "2021-04-03",
+            "department": emp1_data.department
+        }
+
+        report = execute(filters)
+
+        expected_data = self.get_expected_data_for_test_employees()
+        self.assertEqual(report[1], expected_data)
+
+    def test_report_summary_data(self):
+        filters = {
+            "company": "_Test Company",
+            "from_date": "2021-04-01",
+            "to_date": "2021-04-03"
+        }
+
+        report = execute(filters)
+        summary = report[4]
+        expected_summary_values = ['41.67%', 5.0, 10.0, 21.0]
+
+        self.assertEqual(len(summary), 4)
+
+        for i in range(4):
+            self.assertEqual(
+                summary[i]['value'], expected_summary_values[i]
+            )
+
+    def get_expected_data_for_test_employees(self):
+        emp1_data = frappe.get_doc('Employee', self.test_emp1)
+        emp2_data = frappe.get_doc('Employee', self.test_emp2)
+        
+        return [
+            {
+                'employee': self.test_emp2, 
+                'employee_name': emp2_data.employee_name,
+                'department': emp2_data.department, 
+                'billed_hours': 0.0, 
+                'non_billed_hours': 10.0, 
+                'total_hours': 18.0, 
+                'untracked_hours': 8.0, 
+                'per_util': 55.56
+            }, 
+            {
+                'employee': self.test_emp1, 
+                'employee_name': emp1_data.employee_name,
+                'department': emp1_data.department, 
+                'billed_hours': 5.0, 
+                'non_billed_hours': 0.0, 
+                'total_hours': 18.0, 
+                'untracked_hours': 13.0, 
+                'per_util': 27.78
+            }
+        ]
\ No newline at end of file
diff --git a/erpnext/projects/workspace/projects/projects.json b/erpnext/projects/workspace/projects/projects.json
index 0ec1702..62ea3b6 100644
--- a/erpnext/projects/workspace/projects/projects.json
+++ b/erpnext/projects/workspace/projects/projects.json
@@ -131,6 +131,16 @@
    "type": "Link"
   },
   {
+   "dependencies": "Timesheet",
+   "hidden": 0,
+   "is_query_report": 1,
+   "label": "Employee Hours Utilization",
+   "link_to": "Employee Hours Utilization Based On Timesheet",
+   "link_type": "Report",
+   "onboard": 0,
+   "type": "Link"
+  },
+  {
    "dependencies": "Project",
    "hidden": 0,
    "is_query_report": 1,
@@ -161,7 +171,7 @@
    "type": "Link"
   }
  ],
- "modified": "2021-03-26 16:32:00.628561",
+ "modified": "2021-04-19 16:17:30.142545",
  "modified_by": "Administrator",
  "module": "Projects",
  "name": "Projects",