COMMISSIONER OF INCOME TAX Vs. GULF AIR CO.

JUDGEMENT

(1.) 318/Del/2002 relevant for the financial years 1998 -99 and 1999 -2000.

(2.) During survey proceedings, it appeared that the assessee was not deducting tax at source in respect of the salary paid to one Mr. Anwar Shaban, station manager of the assessee. The statement of Anwar Shaban was recorded in respect of his salary and perquisites etc. and he stated that he was being paid a salary of Bahrain Dinar 638 by way of salary and station allowance of Bahrain Dinar of 304. We are told that at the relevant time the exchange rate was 1 Bahrain Dinar equals Rs. 113. The salary plus station allowance received by Anwar Shaban was, therefore, a little over Rs. 1 lac per month. Anwar Shaban also gave his expenditure incurred such as annual fees for the education of his children etc.

(3.) During assessment proceedings, the AO required the assessee to produce some material to indicate the salary paid to Anwar Shaban but despite several opportunities, the assessee did not do so. Accordingly an order was passed under ss. 201(1) and 201(1A) r/w s. 192 of the IT Act, 1961 estimating the salary of Anwar Shaban for the financial year 1998 -99 at Rs. 10 lacs per month and for the financial year 1999 -2000 at Rs. 11 lacs per month.