9911796707
TMI Blog1925 (1) TMI 1X X X X Extracts X X X X X X X X Extracts X X X X ..... tax Officer refused to accept the deductions which the respondent sought to make in respect of the expenses of his business and made a percentage deduction from the profits to represent the legitimate deductions for expenditure incurred and we are told that this percentage was calculated without any relation to the actual facts of the expenditure incurred. An appeal was presented against the assessment to the Assistant Commissioner of Income-tax of the Burdwan Range and he upheld the assessment and the Commissioner refused to make a reference. An application was accordingly made to this Court and the Commissioner was directed to make the reference which is now before us. It is now necessary to turn to the provisions of the Act. Section 23 of the Income-tax Act provides that if the Income-tax Officer has reason to believe that the return made under section 22 is incorrect or incomplete he shall serve on the person who made the return a notice requiring him on a day specified therein either to attend at the office of the Income-tax Officer or produce or cause to be produced at the office any evidence on which the assessee relies in support of the return. Sub-section (3) provides that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... notice directed to specified points if the Income-tax Officer thinks fit to specify, any special points on which he requires evidence. But, as I have already stated, I do not think that the section imposes upon him any obligation to directly specify the points upon which evidence should be given. In my view, in the present case although no notice was served under sub-section (2) of section 23 as required by the Act, this was waived and I think that the servants of the assessee were fully aware of all the matters in the return which were questioned by the Income-tax Officer and that they should not now be given any further opportunity of adducing evidence which they did not ask or desire to adduce either on the 12 or the 13th of October. But my learned brother takes a different view and as I do not think that this is a question upon which there should be a reference to a third Judge and, as I understand, he thinks that the assessee should be a reference to a third Judge and, as I understand, he thinks that the assessee should have a further opportunity of adducing evidence with regard to the items which were disallowed, I do not think that I should stand in the way. The result w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... port of the return. The Commissioner seems to suggest the object of issuing a notice under sub-section (4) of section 22 is practically the same as that of issuing a notice under sub-section (2) of section 23. In this, however, I am unable to agree. Reading sections 22 and 23 of the Act it seems to me clear that the law intends that there should be two opportunities given to the assessee for the purpose of supporting the return which he has submitted. Under section 22 of the Act he is given an opportunity to submit such accounts or documents as the Income-tax Officer may require. When a return is submitted under that section the Income-tax Officer may proceed to deal with the matter on the basis of the return and may not require the assessee to produce any further material or he may, as required by sub-section (4) of that section call upon him to produce or cause to be produced such accounts or documents as the Income-tax Officer may require. Under section 23, sub-section (2), the law gives the assessee a further opportunity of producing any evidence on which the assessee may rely in support of the return. It is true that for two days in the presence of the assessee's Officer t ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... f the return upon the ground that the return is not correct or complete, the assessee is entitled to know the position and to have an opportunity of producing evidence in order to support the return. A further question arises as to what should be the terms of a notice issued under sub-section (2) of section 23. The wording of the sub-section is to the effect that the notice issued under that sub-section should require the assessee either to attend at the Income-tax Officer's Office or to produce or cause to be produced any evidence on which such person may rely in support of the return. That subsection standing by itself would seem to indicate that a general notice calling upon the assessee to appear or to produce evidence or cause it to be produced is sufficient. On a perusal of sub-sections (3) and (4) of section 23, however, it seems to me that ordinarily the notice that is to be issued under sub-section (2) should contain the points upon which the assessee has to produce evidence, if he thinks fit ; for under sub-section (3) the expression on specified points appears to-be governed not only by the word 'required' but also by the word 'produced' appearin ..... X X X X Extracts X X X X X X X X Extracts X X X X
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