DHONDIRAM DALICHAND Vs. COMMISSIONER OF INCOME TAX

JUDGEMENT

(1.) THE questions of law that arise for decision in this reference under section 66(2) of the Indian Income -tax Act, 1922, is as follows :

(2.) THE applicant -assessed carries on business in handloom cloth at Poona and at Bombay. For the assessment year 1958 -59, corresponding to the accounting year S. Y. 2013, the Income -tax Officer rejected the assessee's case that he had made gross profits of 7.8 per cent. as disclosed in the return. For the purpose of arriving at the above finding, the Income -tax Officer relied upon the following circumstances :

(3.) THE Appellate Assistant Commissioner accepted the above finding of the Income -tax Officer and in that connection observed that '... even though his sales during the year exceeded Rs. 7 lakhs, he has not attempted to maintain a quantitative reconciliation with regard to any of the items involved in his trade'. He, therefore, held that the profits disclosed by the assessee remained quite verifiable. Having accepted the findings made by the Income -tax Officer, he rejected the appeal filed by the assessee. He rejected the contention of the assessee that the true profits could be deduced from the method of accounting adopted by the assessee.