Law:

Section:

Section 6(5) of the Taxation on Income (Investigation Commission) Act, 1947 - Commission - Power of - Assessment years 1941-42 to 1948-49 - Whether commission has power to determine income of person whose case is referred to it on proper materials and evidence placed before it - Held, yes FACTS The assessee a lorry driver owned four lorries, subsequently, he had entered into certain agreements with three persons for sharing profits which he earned in the lorry business. In 1941-42 he did not show an income which was assessable, but from 1942-43 upto 1948-49 he showed an assessable income and he was assessed to tax. In 1941-42, 1942-43 and 1943-44 he produced books of account and he was assessed by the Department on those books. However, from 1944-45 to 1948-49 the assessee did not produced books of account stating that the books had been destroyed by fire that took place in an adjoining building. The assessment for these year were therefore made on estimated income. Subsequently, the case had been returned to the Commission under section 5(1). The Commission came to the conclusion that the case of the assessee was false, that the books were being suppressed, and they succeeded in getting some of the books which were produced by the employees. The finding of the Commission with regard to the books that were produced for the assessment years 1941-42, 1942-43 and 1943-44 was that these books were not genuine. The Commission appointed an authorised official to collect various materials and the ultimate report of the Commission was based on the rates for lorry hire that prevailed in the various years. They also considered the ratio of expenditure to income, difficulty on the part of the assessee to procure petrol during the war years, they further gave a concession to the assessee by taking into consideration the fact that traffic was not at all times of the same character merely on the basis of a mathematical average, and taking all these into consideration they estimated the income of the assessee for various years. Further inasmuch as the Commission was making a rough estimate of the income of the assessee, it allowed to the assessee as a deduction such amounts…

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