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2008 (12) TMI 190 - MADRAS HIGH COURTDisallowance of opening capital - held that - In case the estimate made by the Assessing Officer is based on some materials, no interference is possible. Such estimation also involves some guess work and no mathematical formula could be developed in such cases for the purpose of making the estimation and to pass a best judgment assessment. The estimation made by the Assessing Officer by determining the net profit at 5 per cent. was reduced by the Commissioner (Appeals), and the said estimate being made on the basis of the established principles, we do not find any error so as to interfere in such estimation. The authorities below were fully justified in estimating the income from the business on the best judgment basis - deduction on account of disallowance of opening capital was made on account of the failure of the assessee to explain the source of opening capital in a satisfactory manner – decided against the assessee
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