I.T.A. NO.70/LB OF 1988-89 VS I.T.A. NO.70/LB OF 1988-89
1997 P T D (Trib.) 853
[Income-tax Appellate Tribunal Pakistan]
Before Nasim Sikandar, Judicial Member and Khalid Mehmood, Accountant Member
I.T.A. No. 70/LB of 1988-89, decided on 04/10/1995.
Income Tax Ordinance (XXXI of 1979)---
----S. 32(3)---Rejection of accounts---Estimate of sales---Sufficient material, a prerequisite for estimate---Assessing Officer rejected sales given in return and assessed at higher figure reason being, that assessee did not cooperate at time of assessment and Assessing Officer made his own estimation---First Appellate 'Authority, keeping in view estimate of immediate two preceding years, gave some relief---Held, even after rejection of declared version, Assessing Officer must bring on record sufficient material to support his estimation---Such exercise having not been done, element of guess remained present in the case---Appellate Tribunal restricted the sales accordingly.
Saeed Ahmed Ch., C. A. for Appellant.
Qaiser M. Yahya, D.R. for Respondent
Date of hearing: 21st September, 1995.
ORDER
The appellant in this case is a private limited company and derives income from manufacture and sale of steel ingots. The sales were returned at Rs.1,05,87,564 and a rate of 6.91 %. The Assessing Officer rejected the declared version estimate sales at Rs.1,30,00,000 and adopted rate of 9% , Learned first appellate authority after findings that in the immediate preceding two years sales were finally determined at Rs 70,00,000 and Rs.1,10,00,000 directed that estimated sales in the year under review should be restricted to Rs.1,33,00,000. The assessee still feels dissatisfied.
2. Parties have been heard. Learned A.R. for the assesses contends that in the earlier years the declared sales were enhanced by the Assessing Officer in the neighbourhood of 5% while in the year under review the estimation evidenced an increase of 25%. Further, contends that for such estimation the Assessing Officer did not bring any material on record and the learned first appellate authority hesitated allowing adequate relief.
3. Learned D.R. stresses that the assessee failed to cooperate at the assessment level after remand of the case by the first appellate authority and, therefore, the Assessing Officer had to make his own estimation. It is also contended that allowing any relief in this case would amount to give a premium to the assessee for its default.
4. After hearing the parties we find ourselves in agreement with the submission made for the assessee. It is by now a well-settled that even after rejection of declared version the Assessing Officer must bring on record sufficient material to support his own estimation. This exercise was not done in this case. Therefore, the element of guess has remained present with full force. Since the assessment has already had these rounds of proceeding it would not be in the interest of either the Revenue or the assessee's to another remand suggested by the Revenue. We will, therefore, think it appropriate to hold that the sales estimated in the year under review shall be restricted to Rs .1,20,00,000.
5. No other issue has been pressed at the Bar.
6. This appeal succeeds only to the extent of restriction of estimated sales as directed above
M.B.A./252/T