TMI Blog1982 (2) TMI 97X X X X Extracts X X X X X X X X Extracts X X X X ..... at Goa up to and including the assessment year 1972-73. It appears that no assessments were made for the assessment years 1973-74 and 1974-75, and that the assessee shifted his residence to Bombay. Returns of income were filed before the ITO, Bombay, on 22-3-1978 declaring income of Rs. 14,310 for the assessment year 1975-76 and Rs. 7,616 for the assessment year 1976-77. The assessee did not maintain any books of accounts in respect of his commission business. The assessee filed profit and loss account and the balance sheet prepared from the bank accounts for both the years, which showed sundry creditors of Rs. 75,000 for the assessment year 1975-76 and sundry creditors of Rs. 1,50,000 for the assessment year 1976-77. The ITO observed that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... because the cash in hand and banks shown at Rs. 8,667 in the original balance sheet for the year 1976-77 was less than the bank balance of Rs. 9,667 itself, as shown in the revised statement filed before the IAC. It was the case of the assessee that the original profit and loss accounts were not prepared with due care and attention and were incorrect and so the assessments should not have been based on such incorrect statements. The Commissioner (Appeals) considered the above contentions and found that there was material discrepancy between the balance sheets as filed before the ITO and as filed before the IAC which required reconciliation after proper scrutiny of the bank accounts and personal examination of the assessee, if necessary. Hen ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... rged that in the interest of justice, the order passed by the Commissioner (Appeals) deserved to be upheld. 7. We have considered the contentions of both the parties as well as the facts on record. We find force in the contentions raised for the assessee. We find that there is an apparent conflict between the two sets of profit and loss accounts---one filed before the ITO, before he made the draft assessment order, and the other filed before the IAC, before the assessments were finalised. We agree with the Commissioner (Appeals) that the discrepancy required reconciliation. It cannot be said that the first one was always correct especially when the cash and bank balance therein was less than the bank balance itself. Further, the records o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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