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TMI Blog1991 (3) TMI 74X X X X Extracts X X X X X X X X Extracts X X X X ..... t year is 1976-77 The assessment was completed to the best of the Income-tax Officer's judgment on the basis of the materials gathered by him. The Income-tax Officer had obtained the figures pertaining to the turnover of the assessee as available with the Commercial Tax Department. From this, he estimated the gross profit and from that he inferred the taxable income as 25 per cent. of the turnover. The Income-tax Officer also referred to the previous year's assessment records. The assessee appealed to the Commissioner of Income-tax (Appeals) and, along with the appeal memo, enclosed the order of assessment passed by the Commercial Tax Officer under the provisions of the Karnataka Sales Tax Act, 1957. According to the assessee, the figures r ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for him to gather materials which will be self-contained or material which would throw light on the other material already collected. At any rate, the assessee contends that fairness in procedure required the Appellate Assistant Commissioner to look into the assessment order produced by the assessee even though the assessee failed to explain the reason for the belated production of the same. Best judgment assessment is not a provision to penalise the assessee for failure to file the return, etc. It is a machinery provision to enable the Revenue to assess a person when the situation warrants an assessment. order under section 144 is to be made to the best of the judgment of the Income-tax Officer which means that the order has to be ratio ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s estimate of the income, the estimate has to be accepted unless the material is entirely irrelevant. Dhakeswari Cotton Mills Ltd. v. CIT [1954] 26 ITR 775 (SC) was cited in this regard. Similarly, T. Devasahaya Nadar v. CIT [1964] 51 ITR 20, wherein the Madras High Court held that the weight to be attached to the evidence collected by the Income-tax Officer is for him to decide. These principles are not in doubt. Here, we are concerned with the propriety and fairness of the estimate made regarding the income of the assessee on the available material and whether the appellate authority was justified in ignoring the further material produced by the assessee along with the appeal. Income is estimated on the basis of the assessee's turnover ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... he assessee could have produced the sales tax assessment order. But here, we are concerned with the propriety and fairness of the estimate made by the Income-tax Officer who ventured upon an investigation which, on the face of it, is found to be incomplete. The income-tax Officer should have in fairness sought the details of the sales tax assessment order so that he could have obtained the real figures of turnover regarding sales of sugar. In view of item No. 31B of the Fifth Schedule to the Karnataka Sales Tax Act, 1957, turnover relatable to sugar is not taxable under the said Act. If so, taxable turnover under the Sales Tax Act would not disclose the real turnover pertaining to sugar. This background to the case has to be appreciated w ..... X X X X Extracts X X X X X X X X Extracts X X X X
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