TaxTMI 
TaxTMI 
2001 (9) TMI 16
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....eclaring total income at nil. Another return also declaring total income at nil was filed on January 22, 1982, as the date of verification in the first return was not written correctly. A notice under section 143(2) was issued to the assessee in November, 1983, but none appeared for the assessee in response to that notice or even in response to the subsequent notice. A telegram was received from the assessee requesting for hearing with certain other cases. The Assessing Officer sent a letter fixing the next date of hearing. When the chartered accountant for the assessee appeared, details regarding shareholdings and details regarding unsecured loans obtained by the assessee-company were called for. On the next date, no one appeared. Hence, the Assessing Officer sent a notice under section 142(1) calling for all the above details. In spite of the opportunity given, the assessee did not appear nor sent the particulars. Hence, the Assessing Officer proceeded to make the assessment to the best of his judgment under section 144 of the Act. The Assessing Officer made the following observations in the order: "The income under the head 'business' is returned at nil since the assessee does ....
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....sp; Total income 2,50,127 -------- Assessed under section 144. Issue DN and challan. Charged interest under section 139(8)/217." Thereafter, the assessee moved an application under section 146 of the Act, which was rejected by the Income-tax officer and the said order was confirmed by the Commissioner (Appeals). The assessee also preferred an appeal against the order of the Income-tax Officer under section 144 of the Act. On the dates fixed for hearing of the appeal also, nobody attended and on that day, a letter was sent requesting for adjournment on the plea that the director of the assessee-company, Mr. Niranjan, was sick. Hence, another opportunity was als....
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.... was covered by the provisions of section 68 of the Act and that the decisions relied upon on behalf of the assessee were in respect of the legal position as applicable under the Indian Income-tax Act, 1922. Mr. Shah has contended that since the Tribunal proceeded on the footing that the moment the Income-tax Officer found that all the cash credit entries were not satisfactorily explained, such amounts had to be treated as income under section 68 of the Act was not the correct approach in law as section 68 uses the expression "may" in place of "shall" which term was used in the draft bill to confer a discretion on the Income-tax Officer in the matter of treating the unexplained cash credit amounts as the income of the assessee. In support of the said contention. Mr. Shah has placed reliance on the decision of the apex court in CIT v. Smt. P. K. Noorjahan [1999] 237 ITR 570, which was concerned with section 69 of the Income-tax Act, 1961. Mr. Shah read out the order of the Tribunal dealing with this particular question and submitted that the Tribunal has not at all considered the assessee's contention that when the Income-tax Officer had given a finding of fact that the assessee did....
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....ter left Lahore for India with a sealed trunk containing gold ornaments, jewellery and cash which he deposited with a bank at Amritsar. Though initially the karta had gone to Mussoorie, he shifted to Delhi in October, 1947, and started the gold business at Delhi in February, 1948. The first entry in the books of account of the assessee was dated March 30, 1948, bringing in an aggregate capital of certain amounts including gold ornaments and bank and cash balances. When asked to explain the source of the capital brought into the business, the assessee explained that the gold ornaments and cash were brought at the time of migration from Lahore and that from June, 1947, till March 1948, the Hindu undivided family assessee or its karta had no other business or means of income from which the assets in question could be earned. The Assessing Officer, the Appellate Assistant Commissioner as well as the Income-tax Appellate Tribunal and also the High Court held that there was material on the basis of which it was possible to conclude that a substantial amount in question represented the undisclosed income of the assessee. On appeal, the Supreme Court reversed the finding and held that thou....
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....ring at two places was replaced by the word "may" at the instance of the Select Committee in order to confer discretion on the Assessing Officer to consider all the circumstances and to decide whether or not to treat the cash credits in question as income. Coming to the order of the Tribunal in the instant case, all that the Tribunal has stated on this question is as under: "We entirely agree with the submissions made on behalf of the Revenue that the decision in the case of K. S. Kannan Kunhi [1969] 72 ITR 757 (Ker) has no application as it was rendered under the provisions of the Indian Income tax Act, 1922, where a section corresponding to section 68 of the Act, was not there. In fact, this aspect of the matter has been considered in the case of Anup Udyog, with which we are in respectful agreement. In this view of the matter and after considering the material, we do not find any merit in the appeal preferred by the assessee." The Tribunal thus proceeded only on the basis that K. S. Kannan Kunhi's case [1969] 72 ITR 757 (Ker), had no application as it was rendered under the pro visions of the Indian Income-tax Act, 1922, which did not contain a section corresponding to secti....