Law: Income Tax Act, 1922

Section: 13

Income-tax Act (XI of 1922)---S. 13--Trading result of assessee could not be rejected merely on the basis of presumption unless a finding of fact was recorded that on verification of the account books some defects or discrepancies unexplainable were discovered--Where there were no basis before the Income-tax Appellate Tribunal for not accepting the trading result of assessee which was better than the previous years in terms of the volume of sale as well as in percentage of gross profit, increase in the gross profit by 1½% for the previous year on presumption was not justified. New Snow White Dry Cleaner, Karachi v. Commissioner of Income-tax (East), Karachi (1984) 51 Tax 11 and Messrs Kruddsons Limited, S.I.T.E. v. Commissioner of Income-tax 'A' Zone, Karachi I.T.C. Nos. 18 and 27 of 1978 rel. The Commissioner of Income-tax Pona v. Messrs Manna Ramji & Co. A I R 1973 SC 515; Messrs Ibrahim Sons v. Commissioner of Income-tax, Karachi (West), Karachi 1979 P T 1: Miss Assia v. ¬Income-tax Appellate Tribunal, etc. PLD 1979 SC 949 and Raider Ali Rajab Ali & Co. v. Commissioner of Income Tax 1980 P T D 1 ref. JUDGMENT AJMAL MIAN, J.-- This is a direct reference under Section 66 (2) of the Income Tax Act, 1922, hereinafter referred to as the Act, for soliciting the opinion of this Court on the following question mentioned in the order dated 29-5-1978 (Annexure 'D') passed by the Income Tax Appellate Tribunal, declining the applicant's request to make a reference on the above question: "Whether on the facts and in the circumstances of the case the learned Income Tax Appellate Tribunal was justified in applying the proviso to Section 13 of the Income-tax Act?" 2. The brief facts leading to the filing of the above application are that during the Assessment Year 1973-74 (Accounting) commencing on 1-10-1971 and ending on 30-9-1972, the applicant company had disclosed sales of Rs.36,79,798 and gross profit of Rs.4,54,615, which worked out at 12% as against gross profit of 10.7 % of sales of Rs.26,79,197 disclosed by the applicant Company for the previous Assessment year 1972-73 and accepted by the learned Income Tax Appellate Tribunal by its order dated 21-11-1974…

Deprecated: trim(): Passing null to parameter #1 ($string) of type string is deprecated in /home/digixyei/sldsystempk.com/view/master-layout/view_case.php on line 492