2005 (4) TMI 545

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....d to following question of law under section 256(2) of the Income-tax Act, 1961, (hereinafter referred to as 'the Act') for opinion of this Court.      "Whether on the facts and in the circumstances of the case and despite the provisions of Explanation below clause (a) of sub-section (1) of section 44AC of the Income-tax Act, the I.T.A.T. is legally correct in holding that '....

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....s of Explanation below clause (a) of section 44AC, the Assessing Officer quantified the purchase price as under:- Purchase of liquor Rs. 5,76,222 Capsuling charges Rs. 7,45,684 Nirgam Mulya Rs. 36,52,952   Rs. 49,74,858 By applying a rate of 40 per cent as provided in section 44AC the Assessing Officer computed a profit of Rs. 19,89,943 and the assessment was comple....

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....ur v. Dy. CIT Spl. Range, Kanpur wherein it was held that 'Nirgam Mulya' could not be considered as purchase price as it formed part of 'bid money'. 6. As is evident, the department's stand is that the artificial meaning which the Ordinance dated 10-1-1991 referred to supra, gave to the term 'bid money' could not be imported for interpreting the provisions of section 44AC as in such a situation....

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....f the absence of materials, the court was justified in its view that the remedy specified by section 44AC is disproportionate to the evil that prevailed and so to the extent the non obstante clause in section 44AC excluded the provisions of sections 28 to 43C (applicable to all assessees), the provisions are unreasonable. We concur with the aforesaid conclusion of the Andhra Pradesh High Court on ....