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TMI Blog2006 (5) TMI 54X X X X Extracts X X X X X X X X Extracts X X X X ..... section 119 of the Income-tax Act are binding upon the income-tax authorities? (ii) If the answer to question No.1 is negative whether the income-tax authorities at the time of assessment can travel beyond reasons recorded at the time of scrutiny and the reasons can be withheld from the assessee? (iii) Whether, on the facts and circumstances of the case, the appellant-assessee is entitled to be granted the benefit under section 80P(2)(a)(vi) of the Income-tax Act and that too in view of the benefits granted for the last more than one decade ? (iv) Whether, on the employment of some outside labour the co-operative society is to be deprived of the exemptions of the whole of the amount of profits and gains and income of the collective ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... und that the assessee had introduced cash receipts ranging from Rs. 30,000 to Rs. 2 lakhs in the cash book. 3. The assessee failed to explain the nature or source of amount so introduced in the cash book. It was further found that substantial amounts of cash were withdrawn from the bank on different dates and it was shown to have been utilized on the same day but without there being any evidence in the form of bills/vouchers, etc., to support the same. No stock register of the material purchased and utilization thereof was found to have been maintained. Seeing the totality of the circumstances and finding that the books of account maintained by the assessee did not reflect the true and fair state of affairs of the assessee, the provisions ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the settled position of law, a circular issued by the Central Board of Direct Taxes under section 119 of the Act is binding on the authorities below. There is no dispute on the proposition that a circular issued by the Board under section 119 of the Act is binding on the authorities under the Act. However, in the case in hand what has been found is that the due process required under the circular was followed while taking up the case of the assessee for scrutiny and finding to that effect has been recorded in the assessment order as well as the order of the Commissioner of Income-tax (Appeals). The contention of counsel for the assessee to the effect that the reason recorded for taking up the case of the assessee inscrutiny should have bee ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... able to satisfy the authorities with regard to its claim for exemption under section 80P(2) (a) (vi) of the Act. This being the position, it would not be just to claim that merely because in the earlier years or in the subsequent years the assessee had got exemption, the same should be granted in this year as well in spite of the fact that on a perusal of the record before the Assessing Officer, the assessee was not found to be entitled for the same. Reliance upon, a judgment of this court in CIT v. Haryana State Co-operative Labour and Construction Federation Ltd. [2001] 161 Taxation 284 and the Delhi High Court in DIT v. Lovely Bal Shiksha Parishad [2004] 266 ITR 349 is totally misplaced. Since the assessee had neither pleaded before any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... not be the right course. As is found from the facts, the Assessing Officer had estimated the net profit rate at 8 per cent. relying upon the declaration made by some similar other labour contractors whereas the assessee had relied upon another order of the Tribunal where the net profit was assessed at 3 per cent. The Tribunal while rejecting the contention of the assessee had granted substantial relief to the assessee by reducing the net profit rate to 6 per cent. Which is just near to the average of 8 per cent. and 3 per cent. taken together. 14 So, in our opinion, the Tribunal has already granted substantial relief to the assessee to the extent of reduction in the net profit by 25 per cent. as compared to that estimated by the Assessing ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... If the conclusions recorded by the Tribunal in the particular facts of the case are plausible, then it would not be a case of substantial question of law. (f) The finding of fact recorded by the Assessing Officer or the first appellate authority or the Tribunal cannot be disturbed by the High Court in exercise of powers under section 260A of the Act unless such finding is perverse or is such which no person of reasonable prudence could arrive at in the given facts of the case. (See pages 338 and 339 in CIT v. Ms. Monica Oswal [2004] 267 ITR 308 (P&H). 16. Examining the case of the appellant on the above guiding principles, we do not find that the issues raised by the appellant in the appeal fall in any of such parameters. The findin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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