TaxTMI 
TaxTMI 
1975 (8) TMI 18
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....nership firm states that the firm received a letter dated 21st June, 1971, on the 28th June, 1971, from the Income-tax Officer, "J" Ward, Dist. IV(I), Calcutta, whereby the petitioner was informed that there was information in the possession of the said Income-tax Officer on the basis of which the Income-tax Officer held that M/s. Atlas Agencies of 51/59, Dariastan Street, Bombay-3, was a concern of the petitioner. Accordingly, the Income-tax Officer wrote that the income of that concern should have been assessed in the hands of the petitioner. The petitioner was, therefore, asked to show cause why action should not be taken against him to reassess the alleged income of the petitioner for the assessment years 1963-1964, 1964-65 and 1965-66 ....
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....sallowed the interest thereon. All these were stressed, in my opinion, rightly by the counsel for the petitioner, to indicate that the Income-tax Officer examined in detail the transactions with various parties to find out the genuineness of those transactions. It is also apparent that the transactions with Atlas Agencies were disclosed. It is the case of the petitioner in paragraph 9 of the petition that the question of genuineness, existence and validity of all the parties including M/s. Atlas Agencies were scrutinised by the Income-tax Officer at the time of the above assessment. The petition under article 226 of the Constitution was filed on the ground that there was no material for the Income-tax Officer to form the belief for re....
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.... of the above firm was done by my assessee. There was no capital contribution by the so-called two persons of the first constitution of the firm. The huge hundi loans were borrowed by M/s. Atlas Agencies but not independently and not of their own ; the alleged loans were shown to have been guaranteed by my assessee. In the first constitution of M/s. Atlas Agencies two persons were shown as parties, one Shri C. P. Jhaveri and another, Shri L. C. Jhaveri. The former was an employee of M/s. Narayandas Paramananddas over 16 years. He was alleged to have been made active partner. Both of the gentlemen were not of such worthiness in financial resources as to start business on a large scale as in M/s. Atlas Agencies. Subsequently, in relation to a....
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....n or failure on the part of the assessee to disclose fully and truly all material facts necessary for his assessment for assessment year 1963-64, the income chargeable to tax escaped assessment. Hence, proposal is put up under section 147(a) for approval of the Commissioner to issue notice under section 148. As per return filed in the name of M/s. Atlas Agencies, income was Rs. 72,481, but as per facts available on the file relating to M/s. Atlas Agencies, the income is likely to be assessed at Rs. 1,68,041. Sd/- Manohar Lal 23/3/72 (Manohar Lal) I.T.O. 'J' Ward, Dist. IV(I) Calcutta." The question is whether in these circumstances the revenue has really established its case from the materials from which necessary belief c....
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....mounts which were not recorded in the account books, all the conditions for invoking the jurisdiction under clause (a) of section 147 were present. Thereafter, there was a further appeal to the Supreme Court and it was held by the Supreme Court that after discovery of the primary facts relating to the transactions evidenced by the drafts it was for the officer to make necessary enquiries and to draw proper inference as to whether the amounts represented by the drafts could be treated as part of the total income of the appellant. The officer had not done so. Therefore, it was plainly a case of oversight and it could not be said that the income chargeable to tax escaped assessment by reason of omission or failure on the part of the appellant ....