Income Tax Ordinance (XXXI of 1979)---

----Ss. 62 & 144---Assessment on production of accounts, evidence etc, Power to call for information--Rejection of accounts---Rejection of declared version, without any basis regarding un-verifiability of part of the sales and without issuance of notice under S. 144 of the Income Tax Ordinance, 1979 to the parties, was not justified.  

Kh. Riaz Hussain for Appellant.

Abdul Rasheed for Respondent.

Date of hearing: 19th October, 2002.

ORDER

MUHAMMAD MUNIR QURESHI (ACCOUNTANT MEMBER).---This appeal by art A.O.P. is directed against order of the AAC, Sahwial, dated 3-9-1995.

2. It is the appellant's contention that the AAC has unjustifiably confirmed DCIT's rejection of A.O.P.'s accounts.

3. According to the AR of appellant, the assessee has a history of acceptance of trading results. Regular books of accounts are claimed to have been maintained and duly produced before the Assessing Officer supported by necessary invoices. All purchases/sales are statedly properly vouched/verifiable and the Assessing Officer's observation regarding unverifiability of part of the sales is statedly without any basis whatsoever. It is emphasized that the Assessing Officer never issued notice under section 144 of the Ordinance to the parties identified as not properly verifiable. The appellant also denies that proper notice under section 62 was ever issued by the Assessing Officer to interrogate the appellant on the bona fides of the said parties. Finally, it is contended that in any case the Assessing Officer has only tinkered with the trading results and has not made any meaningful addition either to the trading result or to the P & L account and such tinkering was not permissible, especially when the appellant had a history of acceptance of declared trading results that had been upheld by the ITAT (T.A. No. 1361 of 1976-77, Assessment Year 1974-75).

4. According to the DR, the AAC has rightly upheld the rejection of declared version as the same could not be satisfactorily substantiated before the Assessing Officer.

5. We have heard both sides and have examined available record and in our considered judgment, given the facts and circumstances narrated supra, rejection of declared version is not justified. We accordingly direct that the declared version for 1993-94 be accepted.

C.M.A./783/Tax (Trib.) Appeal Accepted.