TaxTMI 
TaxTMI 
1953 (1) TMI 19
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....earing upon them. 2. During the assessment year 1945-46, the applicant was assessed in the capacity of an individual. His sources of income were from house property, share of profits in the partnership firm styled as M/s. L. N. Gadodia&Co., and his receipts from the business run in the name of Kanpur Cotton Mills retail shop which he used to receive through L. N. Gadodia&Co. with the following directions :-- '' In regard to the surplus disclosed on ist year's working of the retail cloth and yarn shop, we now have to advise you that it has been decided by the corporation that half of the amount should be remitted to the Kanpur Cotton ....
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....e sum be paid by the first party to the second party in lieu of the said work. This amount will be liable to be paid by the first party to the second party and the latter would be liable to realise it in any way he liked." It appears that both the appellant and Pt. Sheo Nath Sharma estimated their income for the assessment year 1945-46 treating the said agreement to be valid and enforceable between them. The Income-tax authorities however as well as the Tribunal held the agreement dated 14th November, 1942, to be not a valid and binding arrangement and treated the payments made to Pt. Sheo Nath Sharma as not being a business expenditure, allowance for which could be made under Section 10 (2) (xv) of the Income-tax Act and added this inad....
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....alculated. There is no provision in the Income-tax Act authorising an Income-tax Officer to adjust the advance tax paid by a person against the demand worked out in the case of another person. The advance tax paid by Mr. Sheo Nath Sharma could not, therefore, be adjusted against the demand made from the appellant." 4. The applicant's contention before the Tribunal was that the estimate as made by him was a bona fide estimate as he entertained an honest belief that such part of his receipts as related to the Kanpur Cotton Mills retail cloth shop and such payments as he made to Sheo Nath Sharma were not taxable in his hands and that is why he in good faith filed a low estimate of his income and therefore no penal interest should have b....
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....1-4-0 was rightly charged by the Income-tax Officer under Section 18A (6) of the Income-tax Act? (2) Whether on the facts stated, the advance paid by Sheo Nath Sharma on the estimate of his own income under Section 18A (3) could be legally adjusted to make up the deficiency of the advance tax paid by the applicant under the same section and could exonerate him from imposition of penal interest ? 7. Parties were supplied draft statement of the case. The applicant has raised a number of objections which are in the nature of grounds of appeal against the findings of the Tribunal and if accepted would involve the turning down of the Tribunal's findings. We, therefore, reject....