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TMI Blog1987 (11) TMI 139X X X X Extracts X X X X X X X X Extracts X X X X ..... The return which was on a provisional basis was made at Rs. 6,000 only and the assessment was concluded on an amount of Rs. 60,880. The addition to the income of the assessee was in respect of his business of dealing in silver bullion and ornaments. The books of the assessee were seized by the sales-tax authorities on 17th Sept., 1975 and it remained with them throughout which compelled the legal heir to file the income on a provisional basis. The legal heir could gather the sales figure at Rs. 10,14,640 from 1st April, 1974 to 13th April, 1975 and he arrived at a gross profit of 7.9 per cent and a net profit of 0.6 per cent. This was the basis on which the return was filed. The net profit was determined at 6 per cent by the AAC and the as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... t even on the basis of facts it clearly goes to indicate that the assessee, namely, the legal heir in view of the compelling circumstances of non-availability of books, lack of knowledge of the business, filed return on a provisional basis and provided all co-operation for purposes of completing of the assessment. In view of all these it was pleaded that penalty was not at all called for and should be cancelled. 4. The plea of the learned Departmental Representative on the other hand was that the claim of the assessee that the order is bad in view of notices not being served on all the legal heirs should not be allowed to be raised as that very ground in the quantum proceedings was not pressed by the assessee and therefore the same should ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ba & Co. (1981) 20 CTR (all) 160 : (1981) 123 ITR 564 (all). 5. We have given very careful consideration to the arguments that have been advanced by the parties and have also considered the various material that are placed on record including the Tribunal order referred to by the counsel for the assessee. The records are clearly indicative of the fact that the legal heir of the deceased had filed the return on an estimate basis to the best of his ability and knowledge and with no intention of concealing any particulars. It also emerges from the records that the legal heirs had no prior knowledge about the business, profitability, etc. In the absence of the books which were seized by the Sales-tax Authorities, the legal heir had filed the r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a dealers and grain dealers only. It does not serve any purpose for the computation of the assessee's income. This was a case in which in the past even the Hon'ble Tribunal were pleased to confirm application of net profit rate of 10 per cent as against which this year a net profit rate of 6 per cent only has been applied. The expenses claimed by the assessee are more imaginary than real..... In the facts of the case it cannot be said that the computation of total income made by applying a net profit rate of 6 per cent was, in any way, excessive or unreasonable. The assessment made by the ITO on a total income of Rs. 60,800 is confirmed." The observations of the Tribunal in the quantum appeal are also reproduced below: "In our opinion, th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rred by time or otherwise, the reading of s. 275 is indicative of the fact that penalty can be imposed within a period of two years from the end of the financial year in which the proceedings during the course of which penalty was initiated which in the instant case being the assessment order made on 4th April, 1979, the financial year ending being 31st March, 1980, the order passed on 15th March, 1982 is very much within the time limit prescribed under s. 275. As regards the other alternative legal ground is concerned, that notices were not issued on all the legal heirs it appears to our mind is not tenable, in view of the fact that it was Shri Ramavatar who had filed the return for his deceased father. The plea of the assessee may have de ..... X X X X Extracts X X X X X X X X Extracts X X X X
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