STATE OF MADRAS Vs. S J MEHTA

JUDGEMENT

(1.) THE assessee is this case is a partner in a firm called Surajmals. THEre was a surprise inspection of the business premises of Surajmals as well as the residence of the assessee on 4th September, 1964. During that inspection, certain slips, account books and other records had been recovered. THE said records disclosed that the assessee must have had an independent business of his own, apart from his being a partner in Surajmals. Subsequent to the said inspection resulting in the discovery of the said anamath records from the residence of the assessee, there was an enquiry by the intelligence wing and the assessee was asked to produce the books relating to the said independent business.

(2.) THE assessee appeared once or twice, but he did not produce the account books relating to the said business. As a matter of fact, at every stage when he appeared before the authorities, he asked for time to produce the records. Ultimately, the intelligence wing sent a report as to the discovery of the anamath books and the purport of their subsequent enquiry to the assessing authority on 6th February, 1965. On receipt of that report, the assessing authority called upon the assessee to produce the account books on or before 4th March, 1965, by issuing a notice dated 26th February, 1965. This notice, the assessee received, but he sent in a letter to the effect that as he was going to be out of the city for sometime, the enquiry may be posted to a date subsequent to 30th March, 1965.

(3.) THERE was an appeal by the assessee to the Appellate Assistant Commissioner. But that appeal was dismissed on the ground that it was beyond time. THERE was a further appeal to the Appellate Tribunal. The Tribunal felt that the Appellate Assistant Commissioner was not justified in rejecting the appeal as being out of time. It, therefore, allowed the appeal and directed the Appellate Assistant Commissioner to entertain the appeal and dispose of the same on merits, after giving due opportunity to the assessee. According to the directions of the Tribunal, the Appellate Assistant Commissioner entertained the appeal and considered the same on merits. Before him, the assessee mainly relied on the fact that the assessment has been made without giving him reasonable opportunity, without questioning the assessment on merits. The Appellate Assistant Commissioner held that the assessee had been given reasonable opportunity by the assessing authority before making the assessment and, therefore, the assessment order cannot be set aside on that ground. On the merits, the appellate authority observed that either before the assessing authority or before him, the appellant had not chosen to prove his case that the anamath records cannot form the basis of the assessment.