TMI Blog1955 (1) TMI 41X X X X Extracts X X X X X X X X Extracts X X X X ..... ned an income of ₹ 19,639 on the basis of their accounts. The Income-tax Officer called for their accounts and, on examination, found that they were defective. So, rejecting their estimate, he added a sum of ₹ 54,455 to the income returned. There was an appeal to the Appellate Assistant Commissioner and a further appeal to the Income-tax Appellate Tribunal as a result of which the sum to be added was reduced to ₹ 35,354. Three reasons for rejecting the account books were assigned by the Income-tax authorities : (1)There was evidence that out of the coal supplied by the Government to enable the assessee to perform a contract the assessee sold to a private party two wagon-loads of coal for ₹ 1,000 and this sale was ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onable cause failed to comply with a notice under sub-section (4) of section 22 or sub-section (2) of section 23, or (c) has concealed the particulars of his income or deliberately furnished inaccurate particulars of such income, (he or it may direct) that such person shall pay by way of penalty ...................in the case referred to in clauses (b) and (c) in addition to any tax payable by him, a sum not exceeding one and a half times the amount of the income-tax and super-tax, if any, which would have been avoided if the income as returned by such person had been accepted as the correct income. It is contended for the assessee that the finding recorded by the Income-tax Appellate Tribunal related only to the non-disclosu ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , as their Lordships of the Privy Council stated in Commissioner of Income-tax v. Laxminarayan Badridas [1937] 5 ITR 170 at 180, can only make an honest guess, though he should have reference to some material-not necessarily material that would be evidence in a Court of law. He is not compelled to limit the estimate of the assessee's income to the amount which may have been deliberately suppressed. On other material, the suppression of which can be reasonably suspected, he can make an addition to the income returned. Just as the estimate under section 23(3) is not limited to the amount actually proved to have been concealed, the penalty leviable under section 28(1)(c) is to relate to the actual tax assessed on the income as finally esti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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