TMI Blog1958 (3) TMI 70X X X X Extracts X X X X X X X X Extracts X X X X ..... d whether they do not amount to double taxation? The facts relevant to this question may be shortly stated. The return submitted by the assessee who is dealer in the manufacture and sale of ground-nut kernel and cake at Adoni, disclosed a gross profit of ₹ 5,118 on a turnover of ₹ 3,67,000 the purchase of ground-nut alone amounting to ₹ 2,41,243 and the purchase of kernels being of the value of ₹ 1,07,448. There were no vouchers to support these transactions. The assessee decorticated ground-nuts and obtained kernel. The resultant kernel together with the kernel purchased was crushed by means of expellers yielding ground-nut oil and cake which were sold. No books were maintained to show the daily quantity of k ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oner upheld the addition only to extent of ₹ 37,400. In this opinion, the entries which make up that amount were not satisfactorily explained by the assessee. The assessee carried a further appeal to the Tribunal but unsuccessfully. It is urged by Mr. Rama Rao in support of this reference that the Income-tax Officer having made an estimate of the profits of the business for the assessment year upon an examination of the account books which, as modified by the Appellate Assistant Commissioner, resulted in an addition of ₹ 14,222, it was not open to him to make an addition of another sum in the name of undisclosed profits; in other words, it was open to the Income-tax authorities to accept either the sum of ₹ 14,222 or &# ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e assessee must have made a gross profits of 10% on the turnover as disclosed in his account books. With regard to the other head, he was not prepared to accept the explanation regarding the sources from which the credits were derived and was inclined to view them as profits from undisclosed source. According to him this might have had reference to the business which the assessee carried on outside the books of account. In our opinion, it is certainly open to the Income-tax Officer to make these two additions which fell under two distinct heads. The correct legal positions seems to be that if the two additions are traceable to two distinct heads, namely, one attributable to the business activities of the assessee and is thus an undisclosed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ned came to the conclusion that they were profits made by the firm from undisclosed sources. One of the questions posed before the Bench of the Calcutta High Court was whether the Income-tax Officer could add the amount of unexplained cash credits as profits from undisclosed source when he had already estimated the whole of the undisclosed profits of the business carried on by the assessee. The learned Judges answered it in the affirmative, distinguishing Ramcharitar Ram v. Commissioner of Income-tax [1953] 23 I.T.R. 301 cited on behalf o the assessee, since the Income-tax Officer had not, after making an estimate of the profits of the business and making an addition to the undisclosed books profits, added a further sum as undisclosed ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... oth the credits as well as deficit yield could not be added was not accepted by the Tribunal for the reason that both were separate and distinct has to be understood in the context of the observation made by the Tribunal in its order dismissing the appeal. It would not be possible to construed this as meaning that the case of the appellant was presented in the from in which it is done before us and it was negatived having regard to the fact that it is stated in the statement that particulars regarding this are found in the orders of the Income-tax Officer sand the Appellate Assistant Commissioner, copies of which are annexures 'A' and 'B' and form part of the case. If, however, that is susceptible of the interpretation so ..... X X X X Extracts X X X X X X X X Extracts X X X X
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