1974 (4) TMI 12

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... n 29th November and 30th November, 1965, the petitioner-company received three notices issued under section 148 read with section 147 of the Income-tax Act, 1961 (hereinafter referred to as "the Act") for the assessment years 1957-58, 1958-59 and 1959-60, respectively, whereby the petitioner was called upon to furnish the returns of its income for the said assessment years on the ground that the Income-tax Officer, respondent No. 1, had reason to believe that the income of the petitioner for the said assessment years had escaped assessment. Thereafter, the petitioner made various correspondence with the income-tax department and having regard to the correspondence, the petitioner apprehended that the Income-tax Officer was seeking to reopen .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... er to ascertain the basis of the allocation claimed as deduction and also the system by which such allocations were made by the London company, all the endeavours of the Income-tax Officer and successive incumbents to that office were met by the assessee-company by pleading non-existence of such materials at all. The fact that a certificate of the auditor was given regarding the assessment year 1963-64 may reasonably enable the Income-tax Officer to deduce that such auditor's certificate in respect of the year 1957-58 and the other orders relevant for reopening were existing and it was possible for the assessee to furnish such materials at the relevant time of assessment of each of those years. That non-disclosure clothed the Income-tax Off .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X

..... do so on the ground that no records were maintained by the parent-company on the work relating to the assessee's affairs. The allocation of London management fee was thus arbitrary and devoid of any basis and was only a means of avoiding taxation by debiting excessive sums by way of management fees unrelated to the extent of services rendered. By reason of the assessee's failure to disclose the correct facts its income had been found to have escaped assessment and sanction to reopen the same was, therefore, requested. Dr. Pal, appearing on behalf of the petitioner, contends that the appeal involves substantial question of law of general importance and the question need to be decided by the Supreme Court. Dr. Pal drew our attention to gro .....

X X   X X   Extracts   X X   X X

→ Full Text of the Document

X X   X X   Extracts   X X   X X