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2010 (3) TMI 918 - HC - Income TaxWhether the Tribunal was correct in holding that the bank account and other statements from which income cannot be computed but is written on estimate basis constitute books of accounts and other documents within the meaning of provisions of Section 44AA particularly when clause D & F of explanation to subsection A of Section 139 makes a distinction between a case where books of accounts and documents are maintained and a case where such books of accounts and documents are not maintained? Whether the Tribunal was correct in holding that maintenance of bank accounts reflecting receipts and the turnover certificate based on which financial statements are prepared would be sufficient compliance for the purposes of Section 44AA of the Act even though such statements would not accurately take into account expenditure, other payments and receipts etc.? Held that:- Perusing the reasoning given by the Tribunal and also the relevant provision of law with regard to the maintenance of books of accounts. As already stated, in the absence of there being any prescribed format for the various professions as stated in the said section are entitled to maintain books of accounts in terms of the nature of the business or profession carried on by the various categories mentioned therein. In the instant case, since on the basis of the books of accounts produced by the assessee, the Assessing Officer has processed the assessment and has accepted the said return, the subsequent issuance of notice and proceedings initiated for imposition of penalty on the ground that the books of accounts were not maintained in accordance with the provisions of the Act, in our view, is not just and proper, when there is no infraction of Section 44AA of the Act. Accordingly, the penalty proceedings have to be dropped and the appeal filed by the revenue have to be dismissed. Answering the questions of law against the revenue, the appeals stand dismissed.
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