TaxTMI 
TaxTMI 
2013 (7) TMI 521
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....r 1994-95 on the basis of account books maintained by the appellant. The Assessing Officer, while passing assessment order dated December 29, 1995, had recorded a finding that wrong method was applied by the appellant for calculating the gross profit and net profit. The Assessing Officer, while recording such finding, had compared the various datas furnished for the assessment years 1993-94 and 1994-95 and without giving specific finding in respect of account books, the Assessing Officer in paragraph 2(f) of the order had invoked the provisions of section 145(1) of the Income-tax Act, 1961, and the ratio of the profit which was shown by the appellant at the rate of 19.9 per cent. was enhanced to 21.66 per cent. Learned counsel for the ap....
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....it Nema, advocate, for the appellant that the matter deserves to be remitted back to respondent No. 1, the Commissioner of Income-tax (Appeals), for a fresh decision after considering the aforesaid provisions. Shri Sanjay Lal, advocate appearing for the respondents, has opposed the arguments advanced by learned counsel for the appellant and supported the impugned order. He further submitted that cogent reasons have been assigned by the Assessing Officer in the order dated December 29, 1995, and the reasons have been given in sub-paragraphs (a), (b), (c), (d), (e) and (f) of paragraph 2 of the impugned order, taking cumulatively all the aforesaid grounds and arrived on the conclusion that accounts were not properly maintained by the appel....
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....rs did not help the production in that proportion. In other words, the said repairs and maintenance has not reflected either in production or in trading results. Further, the consumption of coal per unit has considerably decreased and, consequently, the cost of production also should have definitely come down. However, this aspect has not been visible. (c) The average rate of total purchase is less than the average rate of consumed materials. The average rate of closing stock for raw material is 240.2 (Rs.) per M. T. while the average rate of consumed items is 226.40 and average purchase rate (including the opening stock of 1548.100 M. T.) is 230.63. On the above lines, the cost of production should have gone down. The valuation of the c....
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....(Rs. 10,38,056 Rs. 9,49,817) to the total income of the assessee." The Commissioner of Income-tax (Appeals) in the order dated March 27, 1998, had not considered the grounds raised by the appellant before it but in paragraph 4 of the order, the addition made by the Assessing Officer was accepted by the Commissioner of Income-tax (Appeals), assigning no reason. The Income-tax Appellate Tribunal has also not considered the reason for rejecting account books but in paragraph 5 of the order has affirmed the order of the Assessing Officer for rejecting the account books by invoking the provisions of section 145(1) of the Act. In the impugned order, the Tribunal nowhere have considered reasons, for justifying rejection of the account books.....
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....es, 1960. Annual and monthly returns have also to be submitted in accordance with regulations 4 and 5 of the Coal Mines Regulations, 1957. The returns are to be submitted in Forms II and III. The coal produced in the collieries was despatched by rail. That itself is a check against manipulation of accounts. The Tribunal did not consider the argument of the assessee that the statements and returns submitted by the assessee were checked by Governmental authorities under the aforesaid rules and regulations and, therefore, the accounts maintained by the assessee could not be rejected. In our opinion, this was an important factor to be taken into account. Further, the Tribunal committed the error of taking a non-existent fact into consideration ....
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...., therefore, erroneous in law. The Tribunal will have to reconsider the question and to give a fresh finding by considering all the relevant facts." A similar view has been taken by the Patna High Court in MD. Umer v. CIT [1975] 101 ITR 525 (Patna) and also by the Gauhati High Court in Aluminium Industries (P.) Ltd. v. CIT [1995] 80 Taxman 184 (Gauhati). Both the High Courts have held that once the profit could properly deduced from the method of accounting which have been regularly employed, that is the end of the matter in the case, there was no finding that the assessee was not employing a method of accounting and that entries in the books were not correct. In the absence of such finding, the Tribunal had no material before it, on the....