9911796707
TMI Blog1985 (12) TMI 87X X X X Extracts X X X X X X X X Extracts X X X X ..... ITO on 30-8-1982 and, accordingly, a demand notice was issued dated 30-8-1982 showing the amount refundable to the assessee at Rs. 11,514. The assessee filed an audited account in which two profit and loss accounts appeared. One profit and loss account was appearing for National Advertising Agency of which Shri Satya Prosad Sen was shown as proprietor. The profit and loss account disclosed the net profit of Rs. 70,559.48. The second profit and loss account was for National Advertising Agency and a net loss of Rs. 14,182.15 was shown in it. The profit as well as the net loss was carried to the capital account of Shri Sen where the net profit of Rs. 56,377.33 was added to the opening capital of Rs. 3,82,598.60. From the resultant balance of R ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... verification, as also my earlier order under section 163 of the Income-tax Act, 1961, dated 25-4-1984 for the assessment year 1979-80, in the instant case, I hold that the assessment for the assessment year 1980-81, completed under section 143(1) of the Income-tax Act, 1961, is erroneous, being prejudicial to the interests of revenue, for which the said assessment is hereby set aside, with directions to the ITO to complete the assessment afresh as per the provision of law, after giving opportunity of hearing to the assessee." 3. Shri Banerjee, the counsel of the assessee, filed a paper book containing 20 pages. The paper book included the order of the Commissioner under section 263, letters issued by him for the hearing of the appeal, dem ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... inadequate drawings. The drawings shown by the assessee during the year under appeal are adequate and, therefore, even on this ground the action of the Commissioner under section 263 is not justified. 4. Shri Pachau, the senior departmental representative, on the other hand, very strongly supported the order of the Commissioner and urged that the assessee disclosed the receipt in one account at Rs. 61,30,024 and in other account at Rs. 11,01,883. The deductions were claimed straight-away at Rs. 50,65,137 and Rs. 9,01,048 apart from the administrative and office expenses. It shows that the ITO though completed the assessment under section 143(1) but the ITO did not investigate into the facts where it was necessary for him to investigate. ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s: "Explanation: For the purposes of this section,--- (1) an assessment under sub-section (1) shall be deemed to be incorrect, inadequate or incomplete in a material respect, if--- (a) the amount of the total income as determined under sub-section (1) is greater or smaller than the amount of the total income on which the assessee is properly chargeable under this Act to tax ; or (b) the amount of the tax payable as determined under sub-section (1) is greater or smaller than the amount of the tax properly payable under this Act by the assessee; or" The assessee filed the audited profit and loss account and balance sheet. The record of the revenue is available which was perused and he has filed the list of sundry debtors/creditors, ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sment under section 143(1) ignoring the facts that he could have investigated into the payments of Rs. 50 lakhs and odd and Rs. 9 lakhs and odd which were directly deducted from the gross receipts and further the assessee claimed the administrative expenses of Rs. 10,96,000 and Rs. 2,39,000 and odd. The assessee's total receipts in business No. 1 and business No. 2 are for Rs. 72,31,000 and the assessee claimed straight-away deduction for Rs. 59 lakhs and further deduction of administrative business expenses of Rs. 13,35,000. These figures of receipts and expenditure were before the ITO. The ITO also allowed bad debt without investigating into the nature of the bad debt. This shows that the ITO did not investigate into the facts where he wa ..... X X X X Extracts X X X X X X X X Extracts X X X X
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