9911796707
TMI Blog1965 (9) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... that the assessee, a Hindu undivided family, carries on business in fancy goods, electrical goods, watches, radios, etc., in the name and style of "Vasavi General Traders" at Guntakal. It disclosed a net loss of ₹ 2,049 from the business for the assessment year 1953-54, for which the relevant accounting period is the year ending October 18, 1952. The books of account of the assessee were found by the Income-tax Officer to be defective and not maintained in accordance with the vouchers, some of which were subsequently found in the possession of the assessee. In the circumstances, he held that the account books were incomplete and unreliable, and thereafter proceeded to make the "best judgment" assessment by estimat ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... been let off rather cheaply by it." We have extracted the above observations to show that the foundations for the conclusion are erroneous. Apart from there being no reasons given for agreeing with the conclusions of the Appellate Assistant Commissioner and the Income-tax Officer, to say that it was open to the department to have added the entire difference in the turnover, i.e., the difference between the turnover estimated and the turnover disclosed to the profits disclosed, is a result which does not appear to be based on any principle of accountancy or law. The plethora of decisions of the High Courts of this country, as affirmed by their Lordships of the Supreme Court, have consistently insisted upon the income-tax authorities st ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... unity of meeting the case of the department. We could cite a good many cases, but in a recent judgment of ours in R.C. No. 23/62 (Yaggina Veeraraghavalu v. Commissioner of Income-tax [1966] 62 I.T.R. 528), dated February 5, 1965, we reviewed the case-law and held that Income-tax Officers should not only have a basis for determining the assessment, but they must give an opportunity to the assessee to rebut it. We had in that case referred to several decisions including the judgment of their Lordships of the Supreme Court in Dhakeswari Cotton Mills Ltd. v. Commissioner of Income-tax [1954] 26 I.T.R. 775; [1955] 1 S.C.R. 941. We do not propose to go over the same ground again. The result is that the answer to the reference is in the negative ..... X X X X Extracts X X X X X X X X Extracts X X X X
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