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TMI Blog1990 (11) TMI 12X X X X Extracts X X X X X X X X Extracts X X X X ..... the facts and in the circumstances of the case, the Tribunal was justified in sustaining the addition of the sum of Rs. 77,786 made by the Income-tax Officer as income of the assessee under the head 'Other sources' for the assessment year 1963-64 ?" Shortly stated, the facts are that the assessee-company started construction of a building in the accounting year 1960-61 and the construction was completed in the accounting year ending on March 31, 1966. The total cost incurred by the assessee on the construction of the building was considered during the assessment year 1966-67 and the Income-tax Officer was of the opinion that the cost disclosed by the assessee was lower than the cost actually incurred. Accordingly, the Income-tax Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ry pertinent question raised on behalf of the assessee and the only answer given by the Departmental representative was that this question had not been raised either before the Income-tax Officer or before the Appellate Assistant Commissioner or before the Tribunal by a specific ground of appeal. That, indeed, appears to be true but the fact being on record we cannot close our eyes to the errors committed by the authorities below in assessing the entire amount in one year although it had to be assessed in all the years on a pro rata basis. The statement on page 1 of the paper book submitted by the assessee showed that there were only preliminary expenses of a minor nature in 1961-62 and 1967-68. The construction started in full swing in 196 ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... light of the above direction, took action under section 147(a) of the Act and issued a notice to the assessee under section 148. The return filed by the assessee showed an income of Rs.51,450. The Income-tax Officer, after discussing the facts in the assessment year 1966-67 and the order of the Tribunal for that year, came to the conclusion that the assessee did not disclose fully and truly all material facts in the, assessment year 1963-64 and resting upon the finding of the Tribunal, made an addition of Rs. 77,786 as income from other sources, for the cost of construction. The assessee appealed to the Commissioner of Income-tax (Appeals) who upheld the order of the Income-tax Officer. Against the order of the Commissioner of Income-ta ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... riginal assessment stage, the assessee produced the books of account. It is settled law that mere production of books of account is not sufficient to prove that all material facts necessary for the completion of the assessment were fully and truly disclosed. The cost of construction of the building was considered only in the assessment year 1966-67, when the building was complete. The matter was referred to the Departmental valuer and, accordingly, the Income-tax Officer made the addition. On these facts, after considering the arguments of the parties, the case law and the order of the Tribunal for the year 1966-67, the finding recorded by the Income-tax Officer is maintained. Even on merits, the addition is maintained. The addition has alr ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... Income-tax Officer should make proportionate addition for the period during which construction continued. The assessee cannot approbate and reprobate at the same time. It was on the basis of the contention of the assessee which was accepted by the Tribunal that the Tribunal gave the aforesaid direction. In our view, the direction which was given by the Tribunal in connection with the assessment for the assessment year 1966-67 was necessary for the disposal of the appeal on the basis of the submission made by the assessee. The assessee having taken the benefit cannot now ask for overturning the said decision. That apart, the Explanation to section 153 clearly provides that, in any case where income is excluded in appeal, reference or revisi ..... X X X X Extracts X X X X X X X X Extracts X X X X
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