Law: Income Tax Act (XI of 1922)

Section: 13

(a) Income-tax Act (XI of 1922)------   ----- S. 13, proviso-Wool dealer--Shortage of wool revealed by account books-Excessiveness of shortage figure and absence of day-to-day cleaning and packing record - Sufficient material for Tribunal to order reduction in amount of shortage allowed by Appellate Assistant Commissioner.   Held, that the fact that there was absence of day-to-day record of cleaning and packing done by the assessee and the entire shortage could not be verified and was excessive was sufficient material to support the Appellate Tribunal's action in reducing shortage allowed by the Appellate Assistant Commis sioner.   Income-tax Act (XI of 1922), S. 13-Accounts produced Income-tax Officer mayaccept account in toto or reject any unvouched item.   Income-tax Act (XI of 1922), S. 66-Statement of case by Appellate Tribunal-Factsof statement binding on assessee JUDGMENT   INAMULLAH, J.-This is a reference by the Income-tax Appel late Tribunal, Karachi Bench, Karachi, under section 66(1) of the Income-tax Act. The following question of law has been referred to this Court.   "Whether there was any material to support the Tribunal's action in reducing the shortage in wool from 12 % to 10%?"   2. The material facts giving rise to the reference as disclosed in the statement of the case by the Tribunal are these :-   The applicant is a registered firm dealing in cotton, wool and oil. The assessment year is 1951-52 ; the accounting period for the oil and wool business ends on the 31st August 1950 and for the cotton ginning business on the 31st August 1951. The assessee disclosed from its wool account during the year in question total sales of 1198 bales of wool and a shortage of 88 maunds. The quantity of wool packed in this period came to 700 maunds and the deficiency worked out to 12 %. The Income-tax' Officer on an examination of the accounts book found that they were not detailed enough for a verification of the loss claimed. There was no day-to-day record of the cleaning and packing done. He allowed a shortage of only 4%. On appeal the Appellate Assistant Commissioner allowed the appeal and…