9911796707
TMI Blog1966 (10) TMI 35X X X X Extracts X X X X X X X X Extracts X X X X ..... me locality it worked out at 6 to 7%, that the relevant vouchers for purchases by the assessees of goods were not produced, and that in respect of those transactions, besides the entries in the books of account, there was no evidence of actual payment of credit purchases. The Income-tax Officer was, therefore, of the view that the " purchases remained unproved ". Thereafter, he made detailed enquiries and found that the assessees had been selling cloth in the name of Bhuvaneswariah, son of K. Y. Pilliah, principal partner of the assessees, and in the name of Veerabhadrappa, their accountant. These sales were also not entered in the books of account. The explanation of the assessees that these were " accommodation sales to oblige weavers ", ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... for estimating the total, turnover at Rs. 12 lakhs. It was also contended that the cash credit entry of Rs. 7,000 should have been held attributable to the " secreted profits " in the transactions which were not entered in the books of account. In rejecting that plea, the Tribunal observed that the assessees were " in the habit of suppressing not only sales but the corresponding purchases as well, so that the full extent of the business is not made known to the income-tax authorities. It was stated before the Income-tax Officer that certain sales did not pass through the books of account because the assessee wanted to save sales tax. Before the Appellate Tribunal the assessee did not persist in his contention that the sales were not suppres ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... fact that the assessees were in the habit of suppressing not only the sales but the corresponding purchases as well " and also " by the admission made before the Income-tax Officer that certain sales had not passed through the books of account with a view to saving sales tax. These, in the view of the High Court, were " irrelevant considerations and since the decision of the Tribunal was based " on those irrelevant considerations, the answer on the first question must be in favour of the assessees." Similarly, in dealing with the amount of Rs. 7,000, which was treated as income from undisclosed sources, the High Court held that " the Tribunal had not applied its mind to the facts and had recorded its conclusion merely affirming the decision ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... mitted turnover. There were, besides those transactions, other transactions with Messrs. Hameedia Stores and T. Venkataram of which the extent could not be ascertained. On the facts disclosed, the Income-tax Officer could exercise the power to estimate the turnover. The power must of course be exercised not arbitrarily, but judicially in the light of relevant materials. It is, however, not even suggested that the Income-tax Officer acted arbitrarily or capriciously in exercising his power to estimate the undisclosed turnover. The estimate made by the Income-tax Officer was affirmed by the Appellate Assistant Commissioner and the Tribunal. There is no reason to believe that the estimate made by the Income-tax Officer was not reasonably mad ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... under the first question. The second question only relates to the amount of Rs. 7,000 which was the cash credit item which represented an unexplained entry in the books of account of the assessees. In respect of that amount, the Income-tax Officer held that the explanation of the assessees was untrue and the Appellate Assistant Commissioner and the Tribunal agreed with that view. The Income-tax Appellate Tribunal is the final fact-finding authority and normally it should record its conclusion on every disputed question raised before it, setting out its reasons in support of its conclusion. But, in failing to record reasons, when the Appellate Tribunal fully agrees with the view expressed by the Appellate Assistant Commissioner and has no o ..... X X X X Extracts X X X X X X X X Extracts X X X X
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