TMI Blog1996 (2) TMI 167X X X X Extracts X X X X X X X X Extracts X X X X ..... ng and closing stock investors were also available. Cash book was maintained. However, according to him, there were following discrepancies : (i) No stock register of raw material was maintained ; (ii) Day-to-day consumption record was not there but a statement of opening stock, purchases, closing stock and consumption was compiled as desired by the Assessing Officer. The closing stock in this chart showed some variations with the closing stock as per inventory as noted in the assessment order. (iii) The last cash receipt was Sl. No. 6507, which showed that there were 6507 patients, but ultra-sound films 5600 and X-ray films 10,540 were consumed ; There was no satisfactory explanation why films more than the number of patients were us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... cted to one organ only. The variations in opening and closing stock were denied and reconciliation chart was placed before her. 5. It was further submitted before the CIT(A) that in a similar concern, namely, Doctor's X-ray and Pathology, the results were not as good as the assessee's case. Further net profit would work to 47.71% if the Assessing Officer's computation was to be accepted. The net profit rate disclosed was better than immediately preceding year. The net profit rate disclosed this year was 15.88% while in the preceding year it was 9.96% only. 6. The CIT(A) accepted the contentions partly. She observed that no doubt books of account were maintained, but it was to possible to correlate the total number of films used with th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... patients were 6,507, more than one film had been used per patient with the result that 16140 films had been used. Our attention was invited to a copy of a letter from Indian Radiological Association, New Delhi dated 28-9-1994, which was produced before the CIT(A). It was stated therein that it was not true that during radiological/sonographic examination, we use only one film per case. The use varied and for X-ray evaluation up to 10-12 films and in sonography 2-3 films may be used depending on the clinical problem. 9. It was further submitted that cash receipts were being issued for screen display also and this had been accepted by the CIT(A). Regarding balancing of cash book our attention was invited to Explanation (b) of Rule 6F, wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... o him, this showed that the demand notice and ITNS 150 were not ready by 31-3-1994. 12. The learned Departmental Representative, on the other hand, relied strongly on the order of the CIT(A). He submitted that the CIT(A) had upheld the applicability of proviso to section 145(1) since the total number of films consumed could not be correlated with the total receipts. Regarding quantum, substantial relief had also been allowed in the addition and an addition of only Rs. 2 lacs had been sustained as against Rs. 9,14,675 made by the Assessing Officer. He submitted that no further relief was due. Regarding limitation, he relied on the order of the CIT(A), according to which another set of documents were despatched by registered post on 31-3-19 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... documents as may enable the Assessing Officer to compute his total income in accordance with the provisions of this Act ". Thereafter, it is laid down in sub-section (3) that the Board may prescribe by rules, the books of account and other documents to be kept and maintained under sub-section (1) and the particulars contained therein. The relevant rule is rule 6F of Income-tax Rules, 1962. 16. Sub-rule (1) of rule 6F lays down, inter alia, that every person carrying on medical profession shall keep and maintain books of account and other documents specified in sub-rule (2). The books are quite extensive as the following extract will show : " R. 6-F(2) The books of account and other documents referred to in sub-rule (1) shall be the fol ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... nd other consumable accessories used for the purpose of his profession. " 17. It is the assessee's case that all the prescribed books of account and documents were maintained. The discrepancies pointed out by the Assessing Officer did not survive before the CIT(A) in this regard. The only reason why the CIT(A) upheld the applicability of proviso to section 145(1) was that the total number of films consumed could not be correlated with the total receipts. However, such a requirement is not a requirement of section 44AA of the Act or Rule 6-F of Income-tax Rules. 18. From a reading of sub-sections (1) and (2) of section 44AA and rule 6-F of the Income-tax Rules, 1962, it follows that if the prescribed books and documents have been maintai ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
