Mundra Port & Special Economic Zone Ltd., Ahmedabad V. The Income tax Officer,Ward-4(4), Ahmedabad

CO 239/AHD/2008

• Counselvise Citation: [2013] 122 COUNSELVISE.COM (IT) 8433 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 year(s) 6 month(s) 9 day(s)
• Appeal Type: Cross Objection
• Pronouncement Date: 12-04-2013
• Appeal Filed By: Assessee
• Order Result: Dismissed
• Bench Allotted: D
• Next Hearing Date: 06-03-2013
• Assessment Year: 2004-2005
• Appeal Filed On: 03-10-2008
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: T SANKAR
• Section: 37

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, D BENCH, AHMEDABAD BEFORE SHRI A. K. GARODIA, ACCOUNTANT MEMBER AND SHRI KUL BHARAT, JUDICIAL MEMBER I.T.A. NO.3097/AHD/2008 (ASSESSMENT YEAR 2004-05) ITO, WARD 4(4), AHMEDABAD VS. MUNDRA PORT & SEZ LTD., ADANI HOUSE, SHRIMALI SOC. NEAR MITHAKHALI CIRCLE, AHMEDABAD PAN/GIR NO. : AAACG7917K C.O. NO.239/AHD/2008 (ASSESSMENT YEAR 2004-05) MUNDRA PORT & SEZ LTD., VS. ITO, WARD 4(4), ADANI HOUSE, SHRIMALI SOC. AHMEDABAD NEAR MITHAKHALI CIRCLE, AHMEDABAD. (APPELLANT) .. (RESPONDENT) APPELLANT BY: SHRI T SANKAR, SR. DR RESPONDENT BY: SHRI S N SOPARKAR, AR DATE OF HEARING: 07.03.2013 DATE OF PRONOUNCEMENT: 12.04.2013 O R D E R PER SHRI A. K. GARODIA, AM:- THIS APPEAL IS FILED BY THE REVENUE AND C.O. IS FI LED BY THE ASSESSEE AND THESE ARE DIRECTED AGAINST THE ORDER O F LD. CIT(A) VIII, AHMEDABAD DATED 05.06.2008 FOR THE ASSESSMENT YEAR 2004-05. 2. THE CROSS OBJECTION OF THE ASSESSEE WAS NOT PRES SED BY THE LD. A.R. AND ACCORDINGLY THE SAME IS DISMISSED AS NOT PRESSE D. I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 2 3. THE GROUNDS RAISED BY THE REVENUE IN ITS APPEAL ARE AS UNDER: 1. THE LD. CIT(A) HAS ERRED IN LAW AND ON THE FACT S OF THE CASE IN ALLOWING THE CLAIM OF RS.65,00,0007- OF THE ASSESSE E, BEING CONSULTING CHARGES ALLEGED TO HAVE BEEN PAID TO N M CONSULTANTS. 2. ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CAS E, THE LD. CIT(A) OUGHT TO HAVE UPHELD THE ORDER OF THE ASSESSING OFF ICER. 3. IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE L D. CIT(A) MAY BE CANCELLED AND THAT OF THE ASSESSING OFFICER MAY BE RESTORED TO THE ABOVE EFFECT. 4. BRIEF FACTS OF THIS ISSUE TILL THE ASSESSMENT ST AGE ARE NOTED BY LD. CIT(A) IN PARA 5, 5,1 & 5.2 OF HIS ORDER WHICH ARE REPRODUCED BELOW FOR THE SAKE OF READY REFERENCE: 5. THE THIRD GROUND OF APPEAL IS AGAINST ADDITION OF RS.65,00,000/-.THE A. O. VIDE PARA 3 TO 9 OF THE AS SESSMENT ORDER OBSERVED THAT DURING THE COURSE OF ASSESSMENT PROCE EDINGS OF N.M. CONSULTANTS INQUIRIES WERE CARRIED OUT AND IN SOME CASES CONCERNED PARTIES HAVE DENIED TO HAVE ANY TRANSACTI ONS WITH EITHER N.M. CONSULTANTS OR THE APPELLANT. IT WAS ON ACCOUN T OF THIS REASON THAT THE I.T.O. WARD-2, BHUJ ASSESSED THE INCOME OF RS.65 LAKH IN THE CASE OF NIHIR S. MEHTA (PROPRIETOR OF N.M. CONS ULTANTS) AS 'INCOME FROM OTHER SOURCES' INSTEAD OF INCOME FROM BUSINESS OR PROFESSION. IT WAS ALSO OBSERVED BY HIM THAT ON THE BASIS OF ABOVE INTIMATION RECEIVED FROM ITO ,BHUJ , HE HELD THAT T HE EXPENSES PAID TO N.M. CONSULTANTS ARE BOGUS AS NO CONSULTANCY SER VICES WAS PROVIDED BY N.M. CONSULTANTS. 5.1 THE APPELLANT'S REPLY HAS BEEN REPRODUCED BY THE A.O. AT PAGES 3 TO 7 OF THE ASSESSMENT ORDER WHICH SHOWS TH AT THE APPELLANT HAD, INTER ALIA, EXPLAINED THAT I) THE PROCEEDINGS U/S.148 WERE ILLEGAL AND BAD I N LAW. II) THAT THE APPELLANT HAD PAID THE CONSULTANCY CHA RGES TO N.M. CONSULTANTS WHO WERE APPOINTED AS CONSULTANT TO PRO VIDE SERVICES IN RELATION TO INTRODUCTION OF PARTIES, FOLLOW UP E TC. AND ON SUCH PAYMENT, HAD DEDUCTED TAX AT SOURCE AT THE PRESCRIB ED RATE AND ISSUED TE)S CERTIFICATE. III) THE APPELLANT HAD GIVEN NAMES AND ADDRESSES OF THE PARTIES WHO HAD BEEN INTRODUCED TO THE APPELLANT BY N.M. CO NSULTANTS. I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 3 IV) THE EXPENSES ARE GENUINE, AS THEY HAVE BEEN CA RRIED OUT THROUGH BANKING CHANNEL AND THE PAYMENT HAS BEEN CO NFIRMED BY N.M. CONSULTANTS. V) THE A.O. SHOULD NOT PROCEED TO DISALLOW THE CLAI M ONLY ON THE GROUND OF FINDINGS OF ITO IN THE CASE OF N.M. CONSU LTANTS. IT WAS ALSO REQUESTED THAT IN THE INTEREST OF JUSTICE THE APPELLANT SHOULD BE GIVEN AN OPPORTUNITY OF CROSS EXAMINING THE RESPECT IVE PARTIES. THE CONCEPT OF INTRODUCTION WAS WRONGLY INTERPRETED BY THE CONCERNED AUTHORITIES. IT WAS STATED THAT THE MEANI NG OF 'INTRODUCTION' IN THE MODERN COMMERCIAL WORLD IS TO TALLY DIFFERENT THAN WHAT HAS BEEN UNDERSTOOD BY THE ASSESSING OFFI CER OF N.M. CONSULTANT. N.M. CONSULTANT HAD ALREADY AGREED THAT THEY HAD PROVIDED THE SERVICES. IT MAY BE NOTED THAT IN MOST OF THE COMPANIES WITH WHOM WE WERE INTRODUCED ARE LIMITED COMPANIES AND ARE WELL-KNOWN COMPANIES. ALL THESE COMPANIES H AVE NUMBER OF EXECUTIVES, DIRECTORS, PRESIDENTS, VICE-PRESIDEN TS AND IT IS POSSIBLE BECAUSE OF THE TIME GAP THERE MAY BE A SUB STANTIAL CHANGE IN THOSE PERSONS WHO WERE INTRODUCED BY N.M. CONSUL TANT AT THAT RELEVANT POINT OF TIME. VII) THE APPELLANT HAD ALSO FURNISHED COPIES O F LEDGER ACCOUNT OF N.M. CONSULTANTS WITH THE NARRATION AS TO THE NA TURE OF SERVICES FOR WHICH THE AMOUNT WAS PAID TO THEM. IT WAS ALSO EXPLAINED THAT THE PAYMENT OF RS.65,00,000/- IS NOT SUBSTANTIAL IF ONE CONSIDERS THE VOLUME OF GROSS INCOME FROM THE OPERATION WHICH IS RS.L 11 CRORES AND THE EXPENSES ON OPERATION AND MAINTENANC E. 5.2 THE ABOVE EXPLANATION HAS NOT BEEN ACCEPT ED BY THE A.O. FOR THE REASONS FINALLY DISCUSSED IN PARA 9 OF THE ASSESSMENT ORDER. THE REASONS ARE SUMMARIZED AS UNDER: A) THE ASSESSING OFFICER HAD ASKED FOR DETAI LS REGARDING SPECIFIC SERVICES RENDERED BY N.M. CONSULTANTS AND THE COPIES OF ACCOUNTS OF THE PARTIES TO SHOW THE EXTENT OF SERVI CES RENDERED. THE APPELLANT HAD NOT FILED SPECIFIC DETAILS TO SHOW TH E EXTENT OF SERVICES. B) THE CROSS EXAMINATION OF THE PARTIES WOU LD BE SUBSEQUENT STEPS TO CONSIDER WHETHER OR NOT THE PAYMENT WAS GE NUINE. IT IS STATED BY THE ASSESSING OFFICER THAT IT WAS NECESSA RY TO DECIDE AS TO WHETHER THE RESPECTIVE PARTIES WERE INTRODUCED BY N .M. CONSULTANTS. I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 4 C) THE REASONABLENESS OF THE AMOUNT PAID CO MPARED TO THE VOLUME OF EARNING OF THE APPELLANT IS NOT ACCEPTABL E TO THE A.O. ON THE GROUND THAT HE WANTS TO VERIFY THE GENUINENESS OF THE EXPENSES. \L \ D) HE HAS STATED THAT THE APPELLANT HAD TO SUB STANTIATE THE CLAIM OF PAYMENT OF RS.65,00,000/- BY FILING CONTRA COPY OF ACCOUNTS OF THE PARTIES INTRODUCED BY N.M. CONSULTANTS, NATURE OF SERVICES RENDERED BY N.M. CONSULTANTS ETC. IT IS STATED THAT THE APPELLANT HAD NOT FURNISHED THE DETAILS CALLED FOR AND, THERE FORE, HE HAS MADE THE ADDITION OF RS.65,00,000/- IN THE HANDS OF THE APPELLANT AS NON- GENUINE CONSULTANCY CHARGES PAID BY THE APPELLANT. 5. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE LD. CIT(A) WHO HAS DELETED THE ADDITION AND NOW, TH E REVENUE IS IN APPEAL BEFORE US. 6. LD. D.R. SUPPORTED THE ASSESSMENT ORDER. HE ALS O SUBMITTED THAT THE ASSESSEE HAD NOT ESTABLISHED ABOUT RENDERING OF SERVICES AND THE FINDING OF LD. CIT(A) IS NOT ABOUT RENDERING OF SER VICES AND HENCE, THE ORDER OF LD. CIT(A) SHOULD BE REVERSED AND THAT OF THE A.O. SHOULD BE RESTORE. HE DRAWN OUR ATTENTION TO PAGE 49 OF THE PAPER BOOK FILED BY THE ASSESSEE WHERE IT IS STATED BY ONE OF THE PARTIES T HAT THERE WAS NO INTERMEDIARY BETWEEN THEM AND THE ASSESSEE. HE AL SO SUBMITTED THAT COPY OF AGREEMENT HAS NOT BEEN BROUGHT ON RECORD. RELIANCE WAS PLACED ON THE FOLLOWING JUDICIAL PRONOUNCEMENTS: I) 63 ITR 57 SWADESHI COTTON MILLS CO. LTD. VS CIT (S.C.) II) 279 ITR 51 CIT VS PREMIER BREWERIES LTD. (KER) III) 122 ITR 839 SIDDHO MAL & SONS VS ITO (DEL.) 7. AS AGAINST THIS, LD. A.R. SUPPORTED THE ORDER OF LD. CIT(A). HE ALSO SUBMITTED THAT ON PAGES 37-43 OF THE PAPER BOO K ARE THE COPIES OF DEBIT NOTES ISSUED BY THE PARTIES. HE ALSO SUBMITTE D THAT THE ASSESSEE IS INCURRING HEAVY LOSSES AND EVEN WHEN IT WILL HAVE T AXABLE INCOME, THE SAME WILL BE EXEMPT U/S 80-IA(4) AND HENCE, THERE I S NO BASIS OF ALLEGING I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 5 THAT BOGUS EXPENSES WERE CLAIMED BY THE ASSESSEE. RELIANCE WAS PLACED ON THE JUDGEMENT OF HONBLE GUJARAT HIGH COURT REND ERED IN THE CASE OF HEIRS AND LEGAL REPRESENTATIVE OF LATE LAXMANBHAI S PATEL VS CIT AS REPORTED IN 327 ITR 290 (GUJ.). 8. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS, PERUSE D THE MATERIAL ON RECORD AND HAVE GONE THROUGH THE ORDERS OF AUTHORIT IES BELOW AND THE JUDGEMENTS CITED BY BOTH SIDES. FIRST OF ALL WE A NALYZE THE FACTS. WE FIND THAT IN THE PRESENT CASE, THE DISALLOWANCE WAS MADE BY THE A.O. SIMPLY ON THE BASIS OF A REPORT BY THE A.O. OF M/S. N M CONSULTANTS WHO HAVE REPORTED TO THE A.O. OF THIS ASSESSEE THAT HE HAD ISSUED LETTERS TO ALL THE PARTIES WHICH WERE STATED TO HAVE BEEN INTRODUC ED BY N M CONSULTANTS TO THE ASSESSEE AND THE LETTERS COULD N OT BE SERVED AND NO REPLY WAS RECEIVED FROM THE PARTIES TO WHOM LETTERS WERE ISSUED AND ONLY ONE LETTER WAS RECEIVED FROM THYSSEKRUPP INDUSTRIES INDIA PVT. LTD. WHO SAYS THAT N M CONSULTANTS HAD NOT DONE ANY WORK AND IT IS THE A.O. OF N M CONSULTANTS WHO HAS REPORTED THAT THE INCOME RECE IVED BY N M CONSULTANTS WAS NOT FOR THE PURPOSE AS MENTIONED BY IT. ON THE BASIS OF THIS REPORT RECEIVED FROM THE A.O. OF N M CONSULTAN TS, THE A.O. MADE DISALLOWANCE OF THE PAYMENT BY THE ASSESSEE TO N M CONSULTANTS BY HOLDING THAT THE SAME IS NON GENUINE CONSULTANCY CH ARGES PAID AND CLAIMED BY THE ASSESSEE COMPANY. WE ALSO FIND THAT AS PER THE RETURN OF INCOME, THE ASSESSEE HAD DECLARED A LOSS OF RS.7860 .41 LACS AND AFTER MAKING THE DISALLOWANCE OF RS.65 LACS, THE A.O. ASS ESSED THE LOSS OF THE ASSESSEE AT RS.7795.41 LACS. THESE FACTS CLEARLY S HOW THAT AN ASSESSEE HAVING SO MUCH LOSS AND ENGAGED IN SUCH AN ACTIVITY FOR WHICH 100% DEDUCTION IS AVAILABLE U/S 80-IA(4) EVEN FROM THE I NCOME OF THE ASSESSEE, IT IS VERY DIFFICULT TO BELIEVE THAT ANY PERSON WIL L CLAIM BOGUS EXPENSES. I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 6 9. REGARDING THE JUDGEMENTS CITED BY THE LD. D.R., WE FIND THAT THE FIRST JUDGEMENT IS OF HONBLE APEX COURT RENDERED I N THE CASE OF SWADESHI COTTON MILLS (SUPRA). IN THAT CASE, IT WA S HELD THAT IT IS NOT OPEN TO THE ASSESSEE TO CONTEND THAT MERELY BECAUSE OF E XISTENCE OF AN AGREEMENT BETWEEN THE EMPLOYER AND EMPLOYEES AND ON THE BASIS OF THE FACT OF ACTUAL PAYMENT, THE ITO MUST HOLD THAT THE PAYMENT WAS MADE EXCLUSIVELY AND WHOLLY FOR THE PURPOSE OF BUSINESS. THERE IS NO QUARREL ON THIS PROPOSITION BUT IN THE PRESENT CASE, THE AS SESSEE HAS ALSO EXPLAINED THAT THE N M CONSULTANTS HAS RENDERED THE SERVICES FOR INTRODUCING VARIOUS PARTIES TO THE ASSESSEE AND THE A.O. IS SIM PLY STATING THAT THE ASSESSEE HAD NOT FILED SPECIFIC DETAILS TO SHOW THE EXTENT OF SERVICES. WE FAIL TO UNDERSTAND THAT ONCE IT IS STATED BY THE AS SESSEE THAT THE SERVICES RENDERED BY N M CONSULTANTS WAS FOR INTRODUCING THE PARTIES AND THE NAMES AND ADDRESSES OF THOSE PARTIES WERE GIVEN TO THE A.O., THEN WHAT CAN BE OTHER SPECIFIC DETAILS TO SHOW THE EXTENT OF SERVICES. IN THAT CASE, THE DISPUTE WAS THAT AS TO WHETHER THE PAYMENT MADE BY HE ASSESSEE COMPANY TO ITS DIRECTORS AS PER THE SPECIAL RESOLUT ION CAN BE QUESTIONED BY THE A.O. TO FIND OUT AS TO WHETHER THE SAME WAS WHO LLY AND EXCLUSIVELY SPENT FOR THE PURPOSE OF BUSINESS AND IT WAS HELD T HAT THE A.O. CAN MAKE SUCH INQUIRY. IN THE PRESENT CASE, THE INQUIRY WAS MADE BY THE A.O. AND REPLY WAS ALSO GIVEN BY THE ASSESSEE REGARDING THE NATURE OF SERVICES RENDERED BY M/S. N M CONSULTANTS ALONG WITH NAMES A ND ADDRESSES OF THE CONCERNED PARTIES AND HENCE, THIS JUDGEMENT OF HON BLE APEX COURT CITED BY THE LD. D.R. IS NOT RENDERING ANY HELP TO THE RE VENUE IN THE PRESENT CASE. 10. THE 2 ND JUDGEMENT CITED BY THE LD. D.R. IS THE JUDGEMENT O F HONBLE KERALA HIGH COURT RENDERED IN THE CASE OF P REMIER BREWERIES LTD. (SUPRA). IN THAT JUDGEMENT ALSO, RATIO LAID DOWN I S THIS THAT FOR CLAIMING I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 7 ANY DEDUCTIONS U/S 37 OF THE INCOME TAX ACT, 1961, CERTAIN PRE CONDITIONS ARE TO BE SATISFIED. ONE OF THE CONDITIONS IS THIS THAT THE EXPENDITURE MUST NOT BE COVERED BY THE PROVISIONS OF SECTIONS 30-36 AND 80V AND THE 2 ND CONDITION IS THIS THAT THE EXPENDITURE MUST HAVE BE EN SPENT WHOLLY AND EXCLUSIVELY FOR THE PURPOSE OF BUSINESS OF THE ASSE SSEE AND IT SHOULD NOT BE PERSONAL OR CAPITAL IN NATURE. IN THE PRESENT C ASE, THIS IS NOT THE CASE OF THE A.O. THAT THE ASSESSEE IS VIOLATING ANY ONE OF THESE CONDITIONS. REGARDING EXPENDITURE WHOLLY AND EXCLUSIVELY FOR BU SINESS PURPOSE, THIS IS THE ONLY OBJECTION OF THE A.O. THAT THE ASSESSEE COULD NOT FURNISH SPECIFIC DETAILS TO SHOW THE EXTENT OF SERVICES AND FROM THIS OBSERVATION OF THE A.O. IN PARA 9 OF THE ASSESSMENT ORDER, THIS DO ES NOT COME OUT THAT THE A.O. IS DOUBTING INCURRING OF EXPENDITURE WHOLLY AN D EXCLUSIVELY FOR THE PURPOSE OF BUSINESS OF THE ASSESSEE. MOREOVER, WE HAVE SEEN THAT THE ASSESSEE IS DECLARING HUGE LOSSES AND WHENEVER THE ASSESSEE WILL HAVE INCOME AFTER SET OFF OF LOSSES, THE SAME WILL BE EL IGIBLE FOR 100% DEDUCTION U/S 80-IA(4) AND THEREFORE, THIS CANNOT B E ACCEPTED IN THE ABSENCE OF SPECIFIC EVIDENCE THAT THE ASSESSEE HAS CLAIMED BOGUS EXPENSES. 11. THE 3 RD DECISION CITED BY THE LD. D.R. IS THE JUDGEMENT OF HONBLE DELHI HIGH COURT RENDERED IN THE CASE OF SIDDHO MAL & SONS (SUPRA). THIS JUDGEMENT IS ALSO NOT RENDERING ANY HELP TO THE REV ENUE BECAUSE IT WAS HELD IN THAT CASE THAT THE WORD WHOLLY IN THE PRO VISIONS OF I T ACT REFERS TO THE QUANTUM OF EXPENDITURE BUT THE WORD EXCLUSI VELY APPEARS TO REFER TO THE MOTIVE, OBJECTIVE AND PURPOSE OF EXPENDITURE AND HENCE, THE SAME CAN BE EXAMINED BY THE A.O. THERE IS NO QUARREL ON THIS PROPOSITION ALSO THAT THE A.O. CAN EXAMINE THIS ASPECT AS TO WHAT WA S THE MOTIVE OR PURPOSE OR OBJECTIVE OF THE EXPENDITURE AND IN THIS REGARD, IT WAS EXPLAINED BY THE ASSESSEE IN THE PRESENT CASE THAT THE OBJECTIVE OF THE I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 8 EXPENDITURE WAS THIS THAT VARIOUS PARTIES WERE INTR ODUCED BY N M CONSULTANTS TO THE ASSESSEE AND THIS COULD NOT BE P ROVED TO BE FALSE. READING THE LETTER OF ONE OF THE PARTIES, I.E. THYS SEKRUPP INDUSTRIES INDIA PVT. LTD., WHICH IS AVAILABLE ON PAGE 49 OF THE PAP ER BOOK, WE FIND THAT THIS WAS STATED BY THE PARTY THAT THEY DID NOT KNOW SHRI NIHAR S MEHTA, PROPRIETOR OF M/S. N M CONSULTANTS AND HE HAS NOT R ENDERED ANY SERVICES TO THEM FOR ANY TRANSACTION WITH THE ASSESSEE AND T HERE IS NO INTERMEDIARY BETWEEN THEM AND THE ASSESSEE. FROM THIS LETTER, T HIS INFERENCE CANNOT BE DRAWN THAT NO SERVICES WERE RENDERED BY N M CONSULT ANTS TO THE ASSESSEE AND THE ONLY INFERENCE CAN BE DRAWN FORM THIS LETTE R IS THIS THAT NO SERVICE WAS RENDERED BY N M CONSULTANTS TO THAT PARTY. SIM ILARLY, FOR INTRODUCING THE PARTIES, IT CANNOT BE SAID THAT THE INTRODUCER IS AN INTERMEDIARY AND THEREFORE EVERYBODY IN THAT COMPAN Y MUST KNOW THE INTRODUCER. IN THE LIGHT OF THIS LETTER, SUSPICION MAY ARISE WHICH MAY CALL FOR FURTHER INQUIRY BUT THIS IS NOT SUFFICIENT TO R EACH TO A CONCLUSION THAT NO SERVICES WERE RENDERED BY THIS PARTY TO THE ASSE SSEE. NO FURTHER INQUIRY WAS MADE BY THE A.O. IN THE PRESENT CASE A ND EVEN THIS LETTER WAS ISSUED BY THIS PARTY TO THE A.O. OF M/S. N M CONSUL TANTS I.E. ITO WARD (2), GANDHIDHAM AND NOT TO THE A.O. OF THE ASSESSEE I.E. ITO WARD 4(4), AHMEDABAD. CONSIDERING ALL THESE FACTS, WE FEEL TH AT NONE OF THE JUDGEMENTS CITED BY THE LD. D.R. IS RENDERING ANY H ELP TO THE REVENUE. 12. NOW WE EXAMINE THE APPLICABILITY OF THE JUDGEME NT OF HONBLE GUJARAT HIGH COURT CITED BY LD. A.R. I.E. JUDGEMENT RENDERED IN THE CASE OF HEIR AND LEGAL REPRESENTATIVE OF LATE LAXMANBHAI S PATEL (SUPRA). THIS JUDGEMENT IS WITH REGARD TO NOT PROVIDING THE ASSES SEE TO CROSS EXAMINE THE 3 RD PERSON. IN THE PRESENT CASE, THE ASSESSEE HAD REQ UESTED THE A.O. TO PROVIDE OPPORTUNITY TO CROSS EXAMINE THE 3 RD PARTY BUT THE SAME WAS NOT ALLOWED BY THE A.O. BUT WITHOUT GOING ON THIS BASI S, WE FIND THAT I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 9 OTHERWISE ALSO, NO CASE WAS MADE OUT BY THE AUTHORI TIES BELOW FOR MAKING THE DISALLOWANCE WHEN THE ASSESSEE HAD PROVIDED THE NAMES OF THE PARTIES INTRODUCED BY N M CONSULTANTS TO THE ASSESSEE AND T HE A.O. HAS SIMPLY MADE THIS ALLEGATION THAT SPECIFIC DETAILS WERE NOT FURNISHED BY THE ASSESSEE TO ESTABLISH THE EXTENT OF SERVICES WHICH MEANS THAT THE RENDERING OF SERVICE BY N M CONSULTANTS IS NOT IN DOUBT AND T HE DOUBT IS ONLY ABOUT QUANTUM OF SERVICE. MOREOVER, WE HAVE ALSO NOTED THAT THE ASSESSEE HAD REPORTED A LOSS OF RS.7860.41 LACS AND THE ASSESSME NT WAS COMPLETED BY THE A.O. AT A LOSS OF RS.7795.41 LACS EVEN AFTER MA KING THIS DISALLOWANCE OF RS.65 LACS. THIS IS ALSO THE CLAIM OF THE ASSES SEE THAT THE ASSESSEE IS ELIGIBLE FOR DEDUCTION OF 100% U/S 80-IA(4) EVEN IF THE ASSESSEE IS HAVING INCOME IN A FUTURE YEAR. UNDER THESE FACTS, IT IS VERY DIFFICULT TO BELIEVE THAT ANY PERSON WILL CLAIM BOGUS EXPENDITURE. CONS IDERING ALL THESE FACTS, WE DO NOT FIND ANY REASON TO INTERFERE IN THE ORDER OF LD. CIT(A). 13. IN THE RESULT, APPEAL OF THE REVENUE IS DISMISS ED. 14. IN THE COMBINED RESULT, APPEAL OF THE REVENUE A ND THE C.O. OF THE ASSESSEE ARE DISMISSED. 15. ORDER PRONOUNCED IN THE OPEN COURT ON THE DATE MENTIONED HEREINABOVE. SD./- SD./- (KUL BHARAT) (A. K. GARODIA) JUDICIAL MEMBER ACCOUNTANT MEMBER SP COPY OF THE ORDER FORWARDED TO: 1. THE APPLICANT 2. THE RESPONDENT 3. THE CIT CONCERNED 4. THE LD. CIT (APPEALS) 5. THE DR, AHMEDABAD BY ORDER 6. THE GUARD FILE AR,ITAT,AHMEDABAD I.T.A.NO.3097 /AHD/2008 C.O. NO.239/AHD/2008 10 1. DATE OF DICTATION 8/4 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 9/4.OTHER MEMBER 3. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P .S./P.S. 4. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 12/04/2013 5. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR. P.S./P.S.12/4 6. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 12/04/2013 7. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK .. 8. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER . 9. DATE OF DESPATCH OF THE ORDER. .