TMI Blog1993 (11) TMI 16X X X X Extracts X X X X X X X X Extracts X X X X ..... The assessee manufactures textile garments for export. In respect of the assessment year 1977-78, the assessee showed on the credit side an amount of Rs. 37,79,985 under the head "Incentives and drawback". It consisted of drawback of Rs. 4,01,572 and actual cash incentives of Rs. 33,77,473. The Income-tax Officer adopted the method of considering the incentives and drawback, on accrual basis, in view of the mercantile system of accounting followed by the assessee and in view of the previous assessments made on that basis, and assessed the export benefit at Rs. 30,10,289. The taxable income of the assessee was then computed and the assessment order was passed on July 17, 1981. For the assessment year 1978-79, the assessee had filed a retur ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , 1982. They are at annexures "F-1" and "F-2". The petitioner is challenging in this petition the said two notices on the ground that they are invalid and without jurisdiction. What is submitted by the learned advocate for the petitioner is that in this case, notices have been issued because of the change of opinion and this cannot be regarded as a case of suppression of primary material facts which would have disclosed the true nature of the export transactions. The learned advocate for the Revenue, on the other hand, submitted that for the assessment years 1977-78 and 1978-79, the assessee had not disclosed those primary facts which would have shown the true and exact nature of the export transactions. In support of his submission, he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ting Assistant Commissioner has further stated in his affidavit that the trading proceeds of goods sold by export can be split into two broad parts, namely: (i) c.i.f. value of goods exported during the accounting period. (ii) value of all export benefits arising as a result of export sales of the accounting period. He has further stated that the aforesaid two items, together and only together, constitute the correct and complete trading proceeds of export sales of the accounting period. He has then stated : "In view of the above facts, it is submitted that the income, profits and gains of assessment years 1977-78 and 1978-79 have been underassessed because the complete trading proceeds of export sales of the accounting period have ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s incurred by the petitioner for the purpose of exporting the said goods. If in spite of these disclosures, the Assessing Officer had not taken the same into consideration, it cannot be said that there was any suppression of primary material facts by the petitioner. Moreover, we find that this aspect was also considered by the Assessing Officer and the Assessing Officer had come to a different conclusion because he noticed that the petitioner was consistently following the mercantile system of accounting. The petitioner was being assessed since many years and all along, he had been following the same system of accounting. It is nobody's case that for the assessment years 1977-78 and 1978-79, the petitioner had changed the method of accounti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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