1975 (7) TMI 42

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....been made at the instance of the Commissioner of Income-tax on the following facts. The assessee owns a rice mill. He purchases paddy, hulls them and sells the rice. He hulls paddy for hire also. In the relevant previous year which ended on 13th April, 1960, he showed in his books Rs. 1,25,736 as sales. The Income-tax Officer had information from the commercial tax authorities that certain transac....

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.... of rice must have been effected only after conversion in his mill from out of the unaccounted purchase of paddy. In the circumstances, a further addition of Rs. 13,881 will be made to the admitted income." In addition to the above, the income-tax Officer asked the assessee to ledgerise the transactions with N. V. Vadivel Mudaliar & Co. and he found that there was a deficit balance in the said ....

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....me out of the intangible additions made in the assessee's own assessments of the preceding years is legally sustainable, being founded on a reasonable view of the facts and circumstances of the case ?" The question as framed above proceeds on an assumption that there are cash credits to the tune of Rs. 17,840 in the assessee's account on 27th May, 1959. In fact, from the narration of facts give....

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....r itself, it would be clear that the sum of Rs. 1,38,811 represents sales transactions between the assessee and N. V. Vadivel Mudaliar & Co. The sum of Rs. 17,840 forms part of the said sum of Rs. 1,38,811. As far as the profit on the sum of Rs. 1,38,811 is concerned it has already been taxed. There is no further sum of Rs. 17,840 available for taxation as it is clearly part of sale proceeds re....