1962 (6) TMI 45

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....her grounds of attack regarding the assessment order, which I do not think it necessary to go into at present. 3. It seems in the pre-assessment notice, exhibit P-1, the assessing authority states that from the secret account books detected from Shri Pattiari Pachukutty of Kozhikode, three purchases are stated to have been made by Pachukutty from Messrs Haridas Bros., namely: 1. 5-5-1958 Rs. 1,555-06 2. 31-3-1958 Rs. 508-50 3. 10-6-1958 Rs. 550-41   The total of these three items comes to Rs. 2,613-97. It is stated in exhibit P-1 that the petitioner has omitted these sales in his accounts, and therefore the accounts are incomplete and incorrect and cannot be accepted. There is also a stateme....

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....he is not responsible for the books maintained by Pachukutty, the officer does not say further than this, namely, again reiterating that the secret account books detected from Pachukutty show actual transactions. As to how exactly any books of account maintained by somebody else, and much less the secret account books, which according to the department were discovered from a third party, can straightaway and without proof be utilized as against persons like the petitioner, has not been even indicated in the order of assessment. As to whether the petitioner had an opportunity to contest the correctness of the entries in those books, or as to whether the secret account books themselves have been proved by anybody appearing on behalf of Pachuk....

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....rity in my view had absolutely no justification for relying upon the books of account of a third party, much less the secret account books, as against persons like the petitioner, without affording an effective opportunity to cross-examine those persons who are supposed to have maintained the secret accounts and from whom they have been discovered. The fact that some third party maintaining, even according to the department, some secret accounts has made certain entries in his accounts which may connect a person like the petitioner, by itself will not give jurisdiction to the assessing authority to utilize that information, unless that person has been given ample opportunity in the presence of the person who has kept the secret accounts to ....

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....directed to take fresh proceedings for passing an order of assessment for the year in question. The petitioner will be given another opportunity to sustain the return itself, by producing the necessary evidence, oral or documentary. If the assessing authority nevertheless proposes to utilize the information contained in some secret books of account of persons like Pachukutty, as against the petitioner, the assessing authority will have to produce not only those books of account but also the person from whom those books had been seized, for cross-examination at the hands of the petitioner. After completing all these formalities, if the assessing authority proposes to make an assessment on best judgment basis, there is an obligation on his pa....