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TMI Blog1957 (9) TMI 86X X X X Extracts X X X X X X X X Extracts X X X X ..... le of Swamy Brothers . The assessment concerned is the assessment for the year 1124 M.E. (accounting period 1123 M.E.). It was made under section 30(4) of the Travancore Income-tax Act, 1121, corresponding to section 23(4) of the Indian Income-tax Act, 1922, and the question that we have to determine is: Whether there was material for the Tribunal to reject the book results and estimate the income from cocoanut oil and empty tins in the manner it has done? 2. According to the assessee the business was nothing more than a commission agency business from which the firm derived a commission of 0.75 per cent. (12 annas per ₹ 100) of the turnover. The Income- tax Officer declined to accept this contention and held the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ss income the Income-tax Officer adopted 2.75 per cent. and after deducting 0.75 per cent. for the commission accounted for in the commission account the addition was restricted to 2 per cent. In the circumstances of this case where the assessee is not strictly a commission agent the margin of 2 per cent. determined by the departmental officers is not at all excessive. In fact it compares very favourably with the rates disclosed by the other merchants carrying on business under similar circumstances. 6. The same was the approach of the Income-tax Officer: Another oil dealer who does business on the same lines as assessee has shown a gross profit of 2.9 per cent. on theturn over. I will adopt a gross profit of 2.75 in thi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ase of assessment under section 23(3) of the Indian Income-tax Act, 1922, and to Narayan Chandra Baidya v. Commissioner of Income-tax [1951] 20 ITR 287, a case of assessment under section 23(4) of the Indian Income-tax Act, 1922. In the former case the Madras High Court dealt with the question as to whether the Income-tax Officer when making an assessment on material which he himself has gathered shall disclose it to the assessee before making his assessment and give him an opportunity to adduce material in rebuttal as follows: There is nothing in the Act itself which requires the Income-tax Officer to disclose to the assessee the material on which he proposes to act or to refer to it in his order but natural j ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... before us does not deal with this matter and in view of that we have come to the conclusion that we should refer the case back to the Income-tax Appellate Tribunal under section 66(4) of the Indian Income-tax Act, 1922, to make such additions thereto as are necessary to enable us to determine the question. Order accordingly. 11. The contention dealt with in paragraph 5 of the order of the Appellate Tribunal regarding cocoanut oil tins is also not dealt with in the statement of the case. Learned counsel for the assessee states before us that his client is prepared to accept the decision of the Appellate Tribunal on that point and in view of this an addition to the statement of the case on that account is not necessary and is not he ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... it should also disclose to the assessee the material on which the Tribunal is going to found its estimate and then afford him full opportunity to meet the substance of any private inquiries made by the Income-tax Officer if it is intended to make the estimate on the foot of those enquiries. It will also be open to the Department to place any evidence or material on the record to support the estimate made by the Income-tax Officer or by the Tribunal in its judgment. The Tribunal, if it thinks fit may remit the case to the Income-tax Officer for making a fresh assessment after taking such further evidence as is furnished by the assessee or by the Department. If any guidance is required as regards future procedure, the directions giv ..... X X X X Extracts X X X X X X X X Extracts X X X X
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