If books are not correct or complete, the ITO may reject those books and estimate the income to the best of his judgment. When such an estimate is made, it is in substitution of the income that is to be computed under Section 29.

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Excerpt:  The computation under Section 29 is to be made under Section 145 on the basis of the books regularly maintained by the assessee. If those books are not correct or complete, the ITO may reject those books and estimate the income to the best of his judgment. When such an estimate is made, it is in substitution of … Continue reading If books are not correct or complete, the ITO may reject those books and estimate the income to the best of his judgment. When such an estimate is made, it is in substitution of the income that is to be computed under Section 29.

The first appellateauthority found that there was a reasonablecause on the part of the assessee for notpaying the tax before filing the return.in view of 2ndproviso to section 221(1) of the Income Tax Act, no penalty could be imposed.

Posted on by sarvepallilegal

Excerpt: Admittedly, the entire stock and liquid cash were under the custody of the department. Under those circumstances, the first appellate authority found that there was a reasonable cause on the part of the assessee for not paying the tax before filing the return of income. This finding of the first appellate authority is not … Continue reading The first appellateauthority found that there was a reasonablecause on the part of the assessee for notpaying the tax before filing the return.in view of 2ndproviso to section 221(1) of the Income Tax Act, no penalty could be imposed.