1977 (4) TMI 24

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.... the return of June 28, 1965, at Rs. 5,22,609 ? " The assessee, a partnership firm of M.E.S. contractors, Was granted a contract for constructing a runway at Sirsa Airfield. It filed a return on June 30, 1964, for the assessment year 1964-65 showing an income of Rs. 3,98,450 on estimate basis. Therafter accounting year of the assessee was the calendar year ending on December 31, 1963. Thereafter, after completion of work on December 26, 1964, the assessee filed another return on June 28, 1965, on the basis of a consolidated profit and loss account showing an income of Rs. 5,22,609. The construction work was spread over a period of two years beginning from December 28, 1962. The assessee had sold the assets of the partnership firm on t....

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....een made in submitting the return on 28-6-65, there is a difference of Rs. 9,511 between 80 per cent. of the income assessed and the income returned on 27-9-1968. The Explanation to section 271(1)(c) is prima facie applicable. The learned counsel for the assessee submitted that if adjustments for disallowance were made, there would virtually be no excess. The only adjustments possible would be for differences in depreciation of Rs. 7,393, salary of Rs. 710 and travelling allowance to partners of Rs. 1,000. This comes to Rs. 9,103 and does not cover the difference of Rs. 9,511. The balance may be small but it is there and we have to consider with reference to all the circumstances of the case, whether there has been any gross or wilful negle....