TMI Blog1981 (6) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... the above notice submitted returns showing income of Rs. 4,34,024 for the assessment year 1950-51 and Rs. 2,12,839 for the assessment year 1951-52 being incomes on which it was originally finally assessed. In Part " D " of the return the assessee a ISO showed amounts of Rs. 87,225 and Rs. 81, 141 with the following details: 1950-51 1951-52 (i) Credits in Balkishenlal Jankiprasad, Liquidators, Madras a/c 48,979 39,841 (ii) Credits in empty barrels and tins a/c. 39,246 41,300 ------ ------ 87,225 81,141 ------ ------ In the letters attached to the returns the assessee submitted that the amounts credited in the account of Balkishenlal Jankiprasad, liquidators represented dues from customers in respect of M/s. Tarachand Ghanshyamdas before its reconstitution in 1934. It was submitted before him that all the dues from customers prior to 1934 were not taken in the new ledger, but a list of the same was kept and attempts were made to real ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... roceeds of the empty barrels and tins. He observed that, as stated in the assessment years 1952-53 and 1953-54, the prices of kerosene oil and allied products, in which the assessee was dealing, were much higher than those in the open market as these commodities were in short supply and that the businessmen earned very high profits. In the circumstances stated, he held that the credits amounting to Rs. 88,080 and Rs. 89,141 represented the assessee's income from business. These figures were arrived at by him on the basis of the remittances received in calendar years 1949 and 1950, which he adopted as the previous years for the assessment years 1950-51 and 1951-52. He did not agree with the submission of the assessee that the additions, if at all, should be made by taking the financial years as the accounting years. The assessee, thereafter, went up in appeal. The first contention of the assessee before the AAC with which we are really concerned in this reference, was, that the ITO had no jurisdiction to reopen the assessments under s. 34(1)(a) of the Indian I.T. Act, 1922. Reliance was placed on the AAC's order relating to the previous year. It would be better, in view of the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... eparately by the Madras office. Most of those debtors belonged to that area. The accumulated realisations from those debtors were remitted by the Madras office and credited to the account of Balkishenlal Jankiprasad, Liquidator, Madras, in the Calcutta books. This Balkishenlal jankiprasad, Liquidator, Madras account was admitted and declared even at the original assessment stage and as already mentioned, there was a balance (cr.) of Rs. 78,976-15-6, as on December 31, 1949, in the Calcutta Nayabahi account as per statements filed for 1950-51 assessment and a balance (cr.) of Rs. 1,18, 817-10-6 as on December 31, 1950, in the Calcutta Nayabahi account as per statements filed for 1951-52 assessment. The credits during the previous year ended on December 31, 1949, amounted to Rs. 48,976-15-6 and for the year ended on December 31, 1950, to Rs. 39,840-11-0, and these credits were duly recorded in the Balkishenlal Jankiprasad, Liquidator, Madras account of the Calcutta books at ledger page No. 22. At the material time, the appellant had 18 branches in the then East Pakistan and all the branch activities were controlled by Radhakishen Balkishenlal, Narayanganj. The Pakistan authorities ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... tc., supported by its books of account. The balances in the two accounts. Balkishenlal Jankiprasad Liquidator. Madras account and Radhakishan Balkishenlal, Narayanganj account were also disclosed in the statements furnished and there should be no dispute about this. The assessee, according to the AAC, had discharged its duty by revealing all major facts, which had any bearing on the assessments to be made. He had made a clean breast of all the sources of its income; he did not hide any books of account or documents which would help the computation of the total income. The assessee was not expected to do more than this. If the ITO had asked for more details perhaps the appellant would have readily complied with it, according to the AAC. However, the AAC reviewed that the assessee was not expected to delve into the mind of the ITO and to predicate what were the material facts in the view of the officer. According to the AAC, the rule of full and true disclosure of material and necessary facts should bear a nexus on the assessment and should not have only a remote bearing thereon. Relying on these principles, the AAC was of the view that in this case the assessee could not be said to ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... are well settled. It is obligatory on the part of the assessee to disclose fully and truly all material and relevant facts. It is also well settled that production of accounts does not necessarily exonerate an assessee from disclosing fully and truly all material and relevant facts. On behalf of the assessee, it was contended that in this case the balance-sheets were produced and to whom the credits belonged were also disclosed. It was also made quite clear, as would be apparent from the discussion in the order of the AAC, which we have set out hereinbefore, that it was made clear that an inspection of the book of account were not made and, therefore, if on this found the ITO had not doubted any of the items then the assessee could not be made liable. Learned advocate for the assessee sought to urge that if an amount standing to the credit of an assessee in the bank was fully disclosed, it was not obligatory on the part of the assessee, he argued, to fulfil the obligation of a real, full and true disclosure, that the assessee should explain each item which the credit and the debit balance in that particular account represented. On behalf of the Revenue, however, it was urged that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... r situation, of all the relevant and material facts necessary to be disclosed is also a question of fact. It may be that in an appropriate case, the finding of the Tribunal would not be binding on the court, but such a situation would arise where such a finding is challenged either as perverse in law, based on no evidence or a decision which no reasonable man could arrive at. The question as framed in the instant case is not in that fashion. If that is the position, then, in our opinion, there being no question challenging the finding of fact either as perverse in law or the finding is not possible by a reasonable man, it was not possible for the assessee to contend that the Tribunal's finding on this basis was not correct. On the merit also, in order to be a true disclosure we agree with the learned advocate for the assessee that the production of books of account might, in some cases though not necessarily as a matter of law, exonerate the assessee of the obligation as to a full disclosure. It appears to us that the obligation is to make a full disclosure of all relevant and material facts. What would be a full disclosure of all the relevant and material facts would naturally dep ..... X X X X Extracts X X X X X X X X Extracts X X X X
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