TMI Blog1991 (8) TMI 4X X X X Extracts X X X X X X X X Extracts X X X X ..... usiness of exporting manganese ore to England and the United States of America. The Income-tax Officer, Nagpur, issued a notice dated March 20, 1970, under section 148 of the Income-tax Act, 1961 (hereinafter called "the Act"), stating that he had reasons to believe that the income of the appellant chargeable to tax for the assessment year 1953-54 had escaped assessment within the meaning of section 147 of the Act. The company was called upon to show cause why it should not be reassessed to income-tax for the said year. The appellant-company challenged the notice by way of writ petition under article 226/227 of the Constitution of India before the Nagpur Bench of the Bombay High Court. The High Court, by its Judgment dated August 5, 1975, d ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ed by the Collector of Customs dated November 16, 1972, under invoicing was shown to the tune of about Rs. 44/45 lakhs. It is thus obvious that the customs authorities came to the conclusion that the prices mentioned in the relevant contracts between the appellant and the buyers were lesser than the contemporaneous market prices. The customs authorities, thus, found as a fact that the appellant-company was indulging in under-invoicing. The Income-tax Officer, on coming to know about the pendency of proceedings before the Collector of Customs, issued a notice dated March 20, 1970, under section 148 of the Act. In the notice, the reasons on the basis of which he entertained the necessary belief as required under section 147 of the Act were ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... time to issue the said notice on the grounds under section 147(a) Of the Act. Mr. K.Rajagopal.Senior Advocate, learned counsel for the appellant has contended that the Income-tax Officer could not have reason to believe that there was omission or failure on the Part of the appellant to disclose fully and truly all material facts necessary for the assessment and the se income chargeable to tax had escaped assessment. According to him it was not the practice with the appellant to produce the account books from their head Office in London before the Income-tax Officer. The appellant company produced before the Income-tax Officer the balance-sheets, profit and loss accounts and all other necessary records required for the purpose of assessme ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... e of the proceedings is not relevant. What is relevant is the existence of reasons to make the Income-tax Officer believe that there has been under-assessment of the assessee's income for a particular Year. We are satisfied that the first condition to invoke the jurisdiction of the Income-tax Officer under section 147(a) of the Act was satisfied. As regards the second condition, the appellant did not produce the books of account kept by them at their head office in London nor the original contracts of sale which were entered into at London with the buyers . The appellant did not produce before the Income-tax Officer any of the accounts which related to the foreign buyers. No reasons were given for the supply of manganese ore at a rate low ..... X X X X Extracts X X X X X X X X Extracts X X X X
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