The Commissioner Of Income-Tax, Madras vs Sri Meenakshi Mills Ltd. & Ors on 25 October, 1966
v) CIT Vs. Meenakshi Mills Ltd. 63 ITR 609 (SC)
12.1 The learned CIT(A) after considering the submission of the assessee observed that the
Assessing Officer has power to go behind the entries made in books, examine the relevant
documents, explore their genuineness and find out whether the assessee has adopted any
colourable device to evade tax and if he finds the same, he can make disallowance. He further
observed that the Assessing Officer had examined vouchers and found them non-genuine and a
device to inflate expenditure to reduce the profit. The learned CIT(A) justified the Assessing
Officer's action in making the disallowance by adopting the provisions of section 40A(3) of the
Act for quantifying the disallowance. Accordingly, the action of the Assessing Officer was
confirmed.