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TMI Blog1928 (1) TMI 6X X X X Extracts X X X X X X X X Extracts X X X X ..... and another under Section 23 (2), requiring him either to attend or to produce evidence in support of his return. The notice issued is headed Form B. It is a double form calling upon the assessee to do two things: to produce documents to enable the correctness of the return to be tested; and to attend and give any evidence the assessee may desire to give. 2. This double form which is a useful, and practical way of combining two stages into one, is headed Form B. We have been unable to ascertain, either from the manual in use in these provinces, or from the gentlemen who have argued the case before us, whether it is a statutory form or merely a form with no greater authority than that of the department from which it issues. But it is ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... onest excuse that he had not produced the register because the accounts were not clearly entered. It is to be observed that he was not called upon to produce accounts which were clearly entered, or anything which he might, as the sole judge of the matter consider worthy of being produced, but he was called upon to produce such accounts and documents as he had, and it being immaterial whether the accounts were clear or not or whether they were what is considered regular and perfectly kept accounts, he finally said that he did not wish to produce them. He was thereupon assessed by the Income Tax Officer to the best of his judgment under Section 23 (4). The question is whether the Income Tax Officer had jurisdiction to do that. It seems to us ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ach of an express provision to which the penal section which we have just cited in each case refers. It must be admitted that the assessee in this case failed to comply with the terms of the notice issued under Sub-section (4) of Section 22, because he failed to produce this register which was the important document which he had. By a curiously tortuous form of argument it is suggested that this default on his part, does not bring into operation Section 23, Sub-section (4), because it does not constitute a breach of Sub-section (4) of Section 22. For the purpose of that argument it is necessary to introduce into Section 22 (4) an express or implied provision that a notice requiring an assessee to produce accounts and documents can only be s ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ri, unless he is to obtain private information from secret and possibly unreliable sources, how is he to form a belief under Section 23, Sub-section (2), that the return made under Section 22 is incorrect or incomplete, unless at least he can inform himself by the obvious and elementary method of calling for the books? It is to be observed that the notice which he may serve on the person who made the return under Section 23 (2), is only to be served when the officer has reason to believe that the return made is incorrect or incomplete, and unless the return is, on the face of it, ridiculous or the Income tax Officer has secret information, it is impossible for him to form any honest belief on the subject at all, unless he can secure some ma ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a vakil of Madras, the author of the Law and Practice of Income Tax, published in 1922, dealing with this very question of the evidence in support of a return under Section 22. He expresses this opinion: The Income Tax Officer is empowered to call upon the assessee (whether or not he has made a return) to produce such documents and accounts as he may require within the period specified in the notice requiring their production. Sub-8. (4) prevents the Income Tax Officer from calling upon an assessee to produce books of account going back for a period of more than three years prior to the accounting period. There is, however, no such limitation upon the power to call for documents. In the case of trades and business, the Income Tax Officer ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... a notice in accordance with Sub-section (2), Section 23. It is wrong to say that they are meaningless. Many reasons might be given why the draftsman thought it right to insert them where they are. One reason is this that an Income Tax Officer may have honest reason to believe that the return which he has received has been made by the assessee and is incorrect or incomplete, when the return was not in fact made by the assessee at all, and although the Income Tax Officer might have honest reason to believe that it was, and might legitimately serve on such person a notice under Sub-section (2), Section 23, such parson would have a complete answer to an assessment against him to the best of the Income Tax Officer's judgment under Sub-secti ..... X X X X Extracts X X X X X X X X Extracts X X X X
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