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2004 (8) TMI 24 - HC - Income TaxRejection of books of accounts by ITO by invoking the provisos to sub-section (1) and subsection (2) of section 145 - applicant no doubt is maintaining its books of account on the mercantile system and further it has entered the payment to three "karigars" by post-dated cheques which were issued, not on the date of the cheque but on the date when these were handed over. This entry was made in the cash book which obviously was false and as payment is to be recorded when it is actually made even if it is either by way of cash or by way of cheque or draft. In the present case as the applicant had made entries on a date when the actual payment was not made, the payment having been made by post-dated cheques, the books of account maintained by it were clearly unreliable and, therefore, the Income-tax Officer was justified in invoking the provisos to sub-section (1) and subsection (2) of section 145 – assessee’s appeal dismissed
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