TaxTMI 
TaxTMI 
TaxTMI 
2005 (8) TMI 47
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....asound tests was maintained. According to him, there were discrepancies in it inasmuch as no stock register of raw material was maintained. The closing stock in consumption record showed some variation with closing stock as per inventory; there was no satisfactory explanation why X-ray films and ultrasound films more than the number of patients were used, some reports were prepared on the basis of screen display, but cash receipts were not issued, daily balances were not struck in the cash book and separate figures of consumption of ultrasound and X-ray films were not available. The Assessing Officer rejected the book results under the proviso to section 145(1) of the Act and enhanced receipts on estimate resulting in an addition of Rs. 9,14,675. The assessee filed appeal before the Commissioner of Income-tax (Appeals). It was submitted before the Commissioner of Income-tax (Appeals) that the books of account had been maintained in accordance with section 44AA of the Act and rule 6F of the Income-tax Rules, 1962. The Assessing Officer wanted more information than contemplated therein. Some findings were also challenged on the facts. The Commissioner of Income-tax (Appeals), howeve....
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....sh book; (ii) a journal, if the accounts are maintained according to the mercantile system of accounting; (iii) a ledger; (iv) carbon copies of bills, whether machine numbered or otherwise serially numbered wherever such bills are issued by the person, and carbon copies or counterfoils of machine numbered or otherwise serially numbered receipts issued by him: Provided that nothing in this clause shall apply in relation to sums not exceeding twenty-five rupees; (v) original bills wherever issued to the person and receipts in respect of expenditure incurred by the person or, where such bills and receipts are not issued and the expenditure incurred does not exceed fifty rupees, payment vouchers prepared and signed by the person: Provided that the requirements as to the preparation and signing of payment vouchers shall not apply in a case where the cash book maintained by the person contains adequate particulars in respect of the expenditure incurred by him. Sub-rule (3) has prescribed additional books of account for persons carrying on medical profession. Extract is given below: '(3) A person carrying on medical profession shall, in addition to the books of account and other d....
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....pearing on behalf of the Revenue, and Sri S.D. Singh, learned counsel for the assessee-respondent. Learned standing counsel submitted that the Tribunal has erred in holding that once the assessee is found to have maintained the books of account in accordance with rule 6F and no defect is found in such books of account, the proviso to section 145(1) cannot be invoked. He submitted that the proviso to section 145(1) can be invoked even in those cases where the books of account are found to be complete and correct but the method is such that in the opinion of the Assessing Officer the income cannot properly be deduced therefrom then the computation shall be upon such basis and in such manner as the Assessing Officer may determine. He submitted that in the present case the proviso to section 145(1) has been invoked because the total number of films could not be correlated with the total receipts. Thus even though the books of account maintained in accordance with rule 6F are found to be complete and correct and no defect is found but from the books of account the proper income could not be deduced because the assessee has not maintained any account to correlate the total number of fil....
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....ssing Officer is not satisfied about the correctness or the completeness of the accounts of the assessee, or where no method of accounting has been regularly employed by the assessee, the Assessing Officer may make an assessment in the manner provided in section 144. 44AA.(1) Every person carrying On legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or any other profession as is notified by the Board in the Official Gazette shall keep and maintain such books of account and other documents as may enable the Assessing Officer to compute his total income in accordance with the provisions of this Act. Rule 6F. Every person carrying on legal, medical, engineering or architectural profession or the profession of accountancy or technical consultancy or interior decoration or authorised representative or film artist shall keep and maintain the books of account and other documents specified in sub-rule (2): Provided that nothing in this sub-rule shall apply in relation to any previous year in the case of any person if his total gross receipts in the profession do not exceed one lakh fifty thousand rupe....
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....the assessee, the some books of account should be maintained in the nature to correlate the total number of films consumed with the total receipts. In our opinion, this cannot be the basis for invoking the provision of section 145(1) of the Act. Section 44AA of the Act has been introduced by the Taxation Laws (Amendment) Act, 1975, with effect from April 1, 1976, which required a person carrying on the medical profession to keep and maintain such books of account and other documents as may enable the Assessing Officer to compute his total income in accordance with the provisions of the Act. Sub-section (3) provides that the Board may prescribe by rules the books of account and other documents to be kept and maintained with receipt and the particulars contained therein. The Board by rule 6F of the Income-tax Rules, 1962, contemplated certain books of account to be maintained by the medical profession. Thus, once the Board in respect of a particular nature of the profession prescribed maintenance of certain books of account, it is not open to the assessing authority to desire some other books of account to be maintained over and above the books of account required by rule 6F. Any vi....