Bosch Rexroth (India) Ltd., Ahmedabad V. The DY.CIT(Asstt.),Spl.Range-1, Ahmedabad

ITA 1130/AHD/2009

• Counselvise Citation: [2009] 114 COUNSELVISE.COM (IT) 9185 (ITAT-AHMEDABAD)
• Duration Of Justice: 4 month(s) 21 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 04-09-2009
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: B
• Next Hearing Date: 04-08-2009
• Assessment Year: misc
• Appeal Filed On: 13-04-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: P M SHUKLA
• Assessee Lawyers: APARNU PARELKAR
• Keywords: Opportunity of being heard; Bad and doubtful debts; Set aside

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH B AHMEDABAD BEFORE SHRI P.K.BANSAL, ACCOUNTANT MEMBER AND SHRI MAHAVIR SINGH, JUDICIAL MEMBER ITA NO.1130-1132/AHD/2009 ASSESSMENT YEARS:1983-84 TO1985-86 DATE OF HEARING:4.8.09 DRAFTED:13.8.09 BOSCH REXROTH (INDIA) LIMITED, SLM COMPOUND, NR. VATVA RAILWAY STN., VATVA, AHMEDABAD -382445 PAN NO.AAACB9898F V/S . DEPT. COMM. OF INCOME TAX (ASSESSMENT) SPECIAL RANGE-1, AHMEDABAD (PRESENTLY ASSESSED UNDER ADDL. COMMISSIONER OF INCOME-TAX, RANGE-1, AHMEDABAD) (APPELLANT) .. (RESPONDENT) ASSESSEE BY :- SHRI APARNU PARELKAR, AR REVENUE BY:- SHRI P.M. SHUKLA, SR. DR O R D E R PER MAHAVIR SINGH JUDICIAL MEMBER:- THESE THREE APPEALS BY THE ASSESSEE ARE ARISING OU T OF THE ORDERS OF COMMISSIONER OF INCOME-TAX (APPEALS)-VI, AHMEDABAD IN APPEALS NO. CIT(A)- VI/DCIT(OSD)R-I/48, 45, 46/07-08 OF EVEN DATE 23-12 -2008. THE ASSESSMENTS WERE FRAMED BY THE I.A.C.(ASST-I) AHMEDABAD U/S.143(3) O F THE INCOME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) VIDE THEIR D IFFERENT ORDERS DATED 31-03-1986, 24- 02-1987 AND 28-03-1988 FOR THE ASSESSMENT YEARS 198 3-84 TO 1985-86. 2. THE FIRST COMMON ISSUE IN THESE THREE APPEALS OF THE ASSESSEE IS AGAINST THE ORDER OF CIT(A) IN UPHOLDING THE DISALLOWANCE MADE BY THE ASSESSING OFFICER ON ACCOUNT OF COMMISSION PAID. SINCE THE ISSUE IN ALL THE THREE APPEALS ARE COMMON, THE FACTS BEING EXACTLY IDENTICAL, REASONS BEING TH E PARTY ARE SAME TO WHOM THE COMMISSION WAS PAID AND DISALLOWED BY THE AO, THE G ROUNDS WE WILL TAKE UP AS ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 2 RAISED IN THE LEAD YEAR, I.E. ASSESSMENT YEAR 1983- 84. THE RELEVANT GROUNDS RAISED IN ITA NO.1130/AHD/2009 OF THE ASSESSEES APPEAL ARE AS UNDER:- 1. THE ORDER PASSED BY THE COMMISSIONER OF INCOME TAX (APPEALS) IS ERRONEOUS AND CONTRARY TO THE PROVISIONS OF LAW & F ACTS AND THEREFORE REQUIRES TO BE SUITABLY MODIFIED. IT IS SUBMITTED THAT IT BE SO DONE NOW. 2.THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN UPHOLDING THE DISALLOWANCE OF THE COMMISSION PAID OF RS.250000/- ON THE GROUND THAT THE APPELLANT HAD NOT DISCHARGED THE BURDEN TOTALLY. I N THE FACTS AND CIRCUMSTANCES OF THE CASE THE APPELLANT SUBMITS THA T IT HAD DISCHARGED ITS BURDEN TOTALLY BY FILING THE RELEVANT EVIDENCE OF P AYMENT OF COMMISSION & SERVICES RENDERED BY THE AGENT AND ON THAT BASIS TH E DEDUCTION WAS ALLOWABLE. IT IS SUBMITTED IT BE SO HELD NOW. 2.1 THE COMMISSIONER OF INCOME TAX (APPEALS) OUGHT TO HAVE CONSIDERED THE EVIDENCE BEFORE HIM IN PROPER PERSPECTIVE BEFORE DI SALLOWING THE CLAIM I VIEW OF THE FACT THAT THE CIT(A) WAS DECIDING THE MATTER AFTER 15 YEARS OF ITS BEING SET ASIDE BY THE TRIBUNAL, ABOUT A CLAIM MADE BY TH E APPELLANT 26 YEARS AGO. IT IS SUBMITTED IT BE SO HELD NOW. 2.2 THE COMMISSIONER OF INCOME TAX (APPEALS) FAILED TO APPRECIATE THAT IN THE FACTS AND CIRCUMSTANCES APPELLANT HAS DISCHARGE D ITS ONUS AND CIT(A) OUGHT TO HAVE DELETED THE ADDITION. IT IS SUBMITTE D IT BE SO HELD NOW. 3. THE BRIEF FACTS LEADING TO THE ABOVE ISSUE ARE T HAT THE ASSESSEE IS A PUBLIC LIMITED COMPANY ENGAGED IN THE BUSINESS OF MANUFACT URING HYDRAULICS EQUIPMENT ETC., THE ASSESSEE CLAIMED TO HAVE PAID COMMISSION AMOUNTING TO RS.2.50 LAKHS TO M/S. MEHTA INDUSTRIAL CORPORATION (MIC IN SHORT) (O F RS.1.45 LAKHS) AND M/S. ASHOK TEXTILE TRADERS (ATT IN SHORT) (OF RS.1.05 LAKHS). DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER DISAL LOWED THE CLAIM AND THE MATTER TRAVELED UP TO THE TRIBUNAL. THE TRIBUNAL SET ASID E THE MATTER VIDE ORDER DATED 12- 03-1992 IN ITA NO.3299/AHD/1988 AND THE TRIBUNAL OBSERVED IN PARA-6 AS UNDER:- FROM THE DOCUMENTS WHICH WERE FILED BY THE ASSESSE E IT IS CLEAR THAT THERE WAS A MISTAKE IN THE ORDER OF THE ASSESSING OFFICER WHEREIN HE HAD MENTIONED THAT THE ASSESSEE HAD BEEN CALLED UPON TO FURNISH E VIDENCE BY LETTER DT.22-01- 85, IN FACT THE ASSESSEE HAD BEEN CALLED UPON TO FU RNISH EVIDENCE BY LETTER DT.22-01-86. THE ASSESSMENT WAS GETTING TIME BARRED BY 31-03-1986. THE ASSESSING OFFICER WAS BOUND TO COMPLETE ASSESSMENT ON OR BEFORE THAT DATE. IN FACT THE ASSESSMENT HAS BEEN COMPLETED ON 31-03- 1986. THE ASSESSING OFFICER HAS NOTED THAT THE ASSESSEE HAD MADE REQUES T TO EXAMINE THE COMMISSION AGENTS. HOWEVER, THE ASSESSING OFFICER H AD REJECTED THE SAID REQUEST ON THE GROUND THAT THE ASSESSMENT WAS GETTI NG TIME BARRED WITH IN SEVEN DAYS OF MAKING OF SAID REQUEST. THIS IN MENTI ONED IN PARA-2 (V) OF THE ITOS ORDER. IT IS CLEAR THAT THE ASSESSING OFFICER TOOK UP THE ASSESSMENT AT THE FAG END OF THE YEAR JUST TWO MONTH BEFORE THE A SSESSMENT WAS GETTING ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 3 TIME BARRED. DURING THAT PERIOD THE ASSESSEE PRODU CED CONFIRMATION LETTERS FROM THE PARTIES AND REQUESTED AND REQUESTED THE AS SESSING OFFICER TO EXAMINE THE PARTIES. THE ASSESSEE COULD HAVE PROVED THE FACTS WHICH THE ASSESSING OFFICER WANTED TO ASCERTAIN BY EXAMINING THE PARTIES. HOWEVER, THERE WAS NO ENOUGH TIME FOR SUCH EXAMINATION AND F OR THAT REASON THE ASSESSING OFFICER HAD REJECTED THE REQUEST. THE ASS ESSEE HAS FILED IN TABULAR FORM THE COMMISSION PAID IN SEVERAL YEARS IN SUPPOR T OF THE PLEA THAT COMMISSION AS BEING PAID EVERY YEAR EXCEPT IN THE C ALENDAR YEAR 1985 AND 1986. THE COMMISSION RAGED BETWEEN RS.0.85 LACS AND RS.12.54 LACS BETWEEN ASST. YEAR 1983-84 AND 1991-92. THIS ASPEC T HAS NOT YET BEEN CONSIDERED EITHER BY THE ASSESSING OFFICER OR THE C IT(A). CONSIDERING THE ENTIRE CIRCUMSTANCES AND GIVE AN OPPORTUNITY TO THE ASSESSEE TO EXAMINE THE CONCERNED PARTIES AND PRODUCE RELEVANT EVIDENCE AND THEN DECIDE THE QUESTION AFRESH IN ACCORDANCE WITH LAW AFTER GIVING OPPORTUNITY OF BEING HEARD TO THE ITO. THE MATTER IS RESTORED TO THE CIT(A) WI TH THE ABOVE DIRECTIONS. AT THIS STAGER WE DO NOT EXPRESS ANY OPINION ON MERITS . 4. WE FIND THAT THE TRIBUNAL HAS NOT EXPRESSED ANY OPINION OR MERITS AND NOT EVEN CONSIDERED THE JUDGMENT RELIED IN THE GROUND, AND THAT THE MATTER WAS RESTORED BACK TO THE FILE OF THE CIT(A). THE CIT(A) IN FRESH ADJUDICATION CONFIRMED THE ACTION OF THE ASSESSING OFFICER, ON THE GROUND THAT THE ASSES SEE COULD NOT FURNISH THE COPIES OF AGREEMENT IN RESPECT OF COMMISSION PAID, THE DET AILED OF ACTUAL SERVICE RENDERED BY THE AGENTS ALONG WITH THE CORROBORATIVE EVIDENCE . ACCORDINGLY, CIT(A) CONFIRMED THE ACTION OF THE AO. AGGRIEVED, THE ASSESSEE CAME IN SECOND APPEAL BEFORE US. 5. FIRST OF ALL, WE FIND THAT THE TRIBUNAL HAS SET ASIDE THE ASSESSMENT TO THE FILE OF THE CIT(A) VIDE ORDER DATED 12-03-1992 AND THE CIT(A) FIXED THE APPEAL FO R HEARING AND REQUIRED THE ASSESSING OFFICER TO SUBMIT REPORT AND IN TURN, THE AO SUBMITTED HIS REPORT DATED 30-03-2007. IT IS ALSO NOTICED FROM TH E ORDER OF CIT(A) THAT THE AO ISSUED NOTICE TO THE ASSESSEE ON 13-12-2006 AND THE ASSESSEE REPLIED VIDE SUBMISSION DATED 27-12-2006 AND HE SUBMITTED THAT T HE MATER BEING MORE THAN 20 YEARS OLD, THE ASSESSEE COULD NOT LOCATE THE AGENTS ON THE ADDRESSES AVAILABLE WITH THEM. THE CIT(A) ALSO REFERRED THE DETAILS OF ENQUI RY CONDUCTED, BY WHICH THE REPLY OF ONE OF THE AGENT M/S. MIC DATED 28-05-2007 IS RE PRODUCED AS UNDER:- WITH REFERENCE TO THE ABOVE, I REFER TO YOUR ABOVE REFERRED LETTER ASKING FOR CERTAIN DETAILS TO BE FURNISHED TO YOU FOR THE A.Y. 1983-84 TO 1985-86. IN THE MATER, I HAVE TO STATE AS UNDER:- THE FIRM NAMELY MEHTA INDUSTRIAL CORPORATION WHER E I WAS THE PARTNER IS DISSOLVED WITH EFFECT FROM 1 ST JULY, 1983. SINCE THE MATTER PERTAINS TO THE YEARS WHICH ARE ALMOST 20 YEARS OLD WE HAVE NO RECORDS OF THE SAID FIRM IN SO MUCH ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 4 SO TO CONFIRM TO YOU ABOUT THE RECEIPT OF THE COMMI SSION INCOME FROM BOSCH REXROTH (INDIA) LIMITED AND G I REXROTH MANEKLAL LI MITED, FOR THE SAME. WE HAVE TO WITH REGRET STATE THAT WE HAVE NO RECORD S FOR THE ABOVE YEARS (AS WE ARE NOT REQUIRED TO KEEP THE RECORDS OF MORE THA N 10 YEARS) AND THEREFORE ARE UNABLE TO PROVIDE YOU WITH THE INFORMATION CALL ED FOR. SORRY FOR THE INCONVENIENCE CAUSED TO YOU. SIMILARLY, THE CIT(A) ALSO REPRODUCED THE REPLY OF ANOTHER AGENT M/S. ATT, WHICH IS DATED 24-05-2007 AS UNDER:- WITH REFERENCE TO THE ABOVE, I REFER TO YOUR ABOVE REFERRED LETTER ASKING FOR CERTAIN DETAILS TO BE FURNISHED TO YOU FOR THE A.Y. 1983-84 TO 1985-86. IN THE MATTER, I HAVE TO STATE AS UNDER: THE FIRM NAMELY ASHOK TEXTILE TRADERS WHERE I WAS THE PARTNER IS DISSOLVED WITH EFFECT FROM 1 ST APRIL, 1998. SINCE THE MATTER PERTAINS TO THE YEAR S WHICH ARE ALMOST 20 YEARS OLD WE HAVE NO RECORDS OF THE S AID FIRM IN SO MUCH SO TO CONFIRM TO YOU ABOUT THE RECEIPT OF THE COMMISSION INCOME FROM BOSCH REXROTH (INDIA) LIMITED AND G I REXROTH MANEKLAL LI MITED, FOR THE SAME. WE HAVE TO WITH REGRET STATE THAT WE HAVE NO RECORD S FOR THE ABOVE YEARS (AS WE ARE NOT REQUIRED TO KEEP THE RECORDS OF MORE THA N 10 YEARS) AND THEREFORE ARE UNABLE TO PROVIDE YOU WITH THE INFORMATION CALL ED FOR. SORRY FOR THE INCONVENIENCE CAUSED TO YOU. 6. NOW, BEFORE US THE LD. COUNSEL FOR THE ASSESSEE FLED THE COPY OF ACCOUNT OF COMMISSION PAID TO BOTH THE PARTIES AND COPIES OF A CCOUNT OF THE PARTIES AS WELL AS CREDIT NOTES AND BILLS. THE ASSESSEE HAS ALSO FILE D CONFIRMATION OF M/S. MIC AND M/S. ATT, WHEREBY THEY HAVE CONFIRMED THE RECEIPT OF COM MISSION VIDE DATED 21-02- 1986 . THE ASSESSEE HAS ALSO REQUESTED THE AO DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS TO EXAMINE M/S. MIC AND M/S. ATT AND THE RELEVANT TEXT OF THE LETTER DATED 24-03-1986 TO THE IAC ASSESSMENT READS AS UNDER:- THE INQUIRY REGARDING THE ORDER FROM M/S. INDIA RA DIATORS LTD. FOR SUPPLY OF POWER PACKS AND HYDRAULIC SYSTEM WAS BROUGHT BY M/S . ASHOK TEXTILE TRADERS (PARTYS PURCHASE ORDER NO.SA 362/81-82 DT. 27.8.81) AND FOR THE SERVICES RENDERED IN CONNECTION WIH THIS BUSINESS, M/S. ASHOK TEXTILE TRADERS WAS PAID RS.1,05,000/- AS COMMISSION BY A/C PAYEE CHEQUE IN THEIR FAVOUR. PARTY HAS CONFIRMED THE RECEIPT OF THE COMM ISSION VIDE THEIR LETTER DATED 2.1.2.1986, COPY OF WHICH HAS ALREADY BEEN HA NDED OVER TO YOUR GOODSELVE. IF YOU NEED FURTHER EXPLANATION AND IF YOU DEEM FIT , WE REQUEST YOU TO EXAMINE M/S. MEHTA INDUSTRIAL CORPON. & ASHOK TEXTILE TRADE RS FOR THE ABOVE PAYMENT OF COMMISSION. ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 5 BEFORE US LD. COUNSEL FOR THE ASSESSEE STATED THAT THE ENTIRE PAYMENT MADE BY ACCOUNT PAYEE CHEQUE AND BOTH THE PARTIES HAVE CONF IRMED THE RECEIPT OF COMMISSION AND EVEN BOTH THE PARTIES HAVE GIVEN PRO OF OF SERVICE RENDERED EXCEPT THE EXAMINATION OF PARTIES AND THAT ALSO DUE TO REA SON THE MATER BEING 26 YEARS OLD. THE LD. COUNSEL ALSO REFERRED TO THE FACT THAT THE MATTER WAS SET ASIDE TO THE FILE OF THE CIT(A) IN 1992 AND NOW THE CIT(A) HAS PASSED SE T ASIDE APPELLATE ORDER IN DECEMBER, 2008, I.E. ALMOST AFTER 16 YEARS AND THAT ALSO WITHOUT ANY REASON, THE ASSESSEE NOW IS UNABLE TO GET EXAMINE THOSE PARTIES . THE LD. COUNSEL THEN RELIED ON THE DECISION OF HONBLE CALCUTTA HIGH COURT IN T HE CASE OF MATHER & PLATT (INDIA) LTD. V. CIT (1987)168 ITR 493 (CAL). ON THE OTHER HAND, LD. D EPARTMENTAL REPRESENTATIVE RELIED ON THE ORDERS OF LOWER AUTHOR ITIES. 7. AFTER HEARING THE RIVAL CONTENTIONS AND GOING TH ROUGH THE FACTS AND CIRCUMSTANCES OF THE CASE, WE FIND THAT EVEN NOW BE FORE US THE ASSESSEE HAS SUBMITTED:- 1.CREDIT NOTE ISSUE IN FAVOUR OF COMMISSION AGENT. 2. COPY OF PURCHASE ORDER RECEIVED FOR WHICH ASSESS EE HAS GIVEN THE COMMISSION. 3. STAMP RECEIPT FROM THE COMMISSION AGENT MENTIONI NG THE PAYMENT RECEIVED AGAINST COMMISSION AND HIS PAN NO. 4. CERTIFICATE OF CA CERTIFYING THAT WHERE THEY ARE ASSESSED, PAN NO. RECEIPT OF COMMISSION AND COPY OF ACCOUNT OF REXROTH IN BOO KS OF COMMISSION AGENT. 5. LEDGER COPY OF REXROTH IN THE BOOKS OF COMMISSIO N AGENT. WE FURTHER FIND THAT DURING THE COURSE OF ORIGINAL ASSESSMENT PROCEEDINGS, THE ASSESSEE HAS FILED COMPLETE CONFIRMATION OF THESE T WO COMMISSION AGENTS INCLUDING THEIR PAN NO. NAME AND ADDRESS. THE ASSESSEE ALSO M ADE REQUEST TO THE AO TO EXAMINE THE COMMISSION AGENT AND THIS IS CLEAR FROM THE ASSESSEES LETTER DATED 24- 03-1986, THE RELEVANT TEXT OF THE SAME IS BEING REP RODUCED IN PARA-4 OF THIS ORDER. APART FROM THIS, WE ALSO FIND THAT THE ASSESSEE HAS PAID COMMISSION IN SEVERAL YEARS AND IN SUPPORT OF ITS PLEA THAT THE COMMISSION BEIN G PAID IN EVERY YEAR IS ALLOWED EXCEPT IN THOSE THREE ASSESSMENT YEARS AND THE COMM ISSION RANGE BETWEEN 0.85 LAKHS TO RS.12.54 LAKHS OF ASSESSMENT YEAR 1983-84 TO ASSESSMENT YEAR 1991-92. ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 6 WE FURTHER FIND THAT THIS ASPECT HAS NOT BEEN CONSI DERED BY EITHER OF THE LOWER AUTHORITIES, I.E. AO OR THE CIT(A). WE FURTHER FIN D FROM THE ABOVE CASE LAW REFERRED BY THE LD. COUNSEL FOR THE ASSESSEE IN THE CASE OF MATHER & PLATT (INDIA) LTD. (SUPRA), WHEREIN THE HONBLE CALCUTTA HIGH COURT HA S HELD AS UNDER:- ON A CONSIDERATION OF THE FACTS AND CIRCUMSTANCES, IT APPEARS TO THAT BY TAKING AN OVERALL VIEW, IT IS FOUND THAT THE ASSESS EE HAD BEEN ENTERING INTO TRANSACTIONS IN ITS REGULAR COURSE OF BUSINESS THRO UGH COMMISSION AGENTS AND PAYING THE AGENTS COMMISSION ON THE BASIS OF THE T RANSACTIONS HAD. IN RESPECT OF COMMISSION PAID TO THE TWO COMMISSION AG ENTS WHICH ARE IN DISPUTE, THE ASSESSEE HAD ESTABLISHED THAT IN 1974 THE ASSESSEE WAS IN CORRESPONDENCE WITH THE SAID AGENTS. THE ASSESSEE H AS ENTERED INTO THE TRANSACTIONS THROUGH THE SAID AGENTS AND THE ASSESS EE HAS PAID COMMISSION TO THE SAID AGENTS, IN ONE CASE BY BANK DRAFT AND I N OTHER CASE BY AN ACCOUNT PAYEE CHEQUE WHICH WAS ENCASHED THROUGH A BANK ACCO UNT OF THE AGENT. IT STANDS ESTABLISHED THAT AT THE MATERIAL TIME AT LEA SE ONE OF THE COMMISSION AGENTS WAS MAINTAINING A BANK ACCOUNT. THE ONLY FACT ON WHICH THE TRIBUNAL HAS PROCEEDED I S THAT FOUR YEARS AFTER THE TRANSACTIONS, SUMMONSES SERVED ON THE COMMISSION AG ENTS WERE COME BACK UNSERVED. ON THE ENTIRETY OF THE EVIDENCE, IT CANNO T BE FOUND THAT IF A PERSON IS NOT FOUND IN AN ADDRESS AFTER FOUR YEARS, HE IS NOT EXISTENT. IN OUR VIEW, THE ASSESSEE HAS DISCHARGED ITS PRIMARY ONUS TO ESTABLI SHED THE IDENTITIES OF THE SAID TWO COMMISSION AGENTS AND THE EVIDENCE HAD BEE N BROUGHT ON RECORD BY THE REVENUE TO REBUT THE CASE OF THE ASSESSEE. ON T HE ENTIRETY OF THE EVIDENCE, IT WOULD BE UNREASONABLE TO HOLD THAT THE ASSESSEE HAD FAILED TO ESTABLISH THE IDENTITY OF THE SAID TWO COMMISSION A GENTS AND THAT PAYMENTS TO THE SAID COMMISSION AGENTS WERE NOT GENUINE. HERE, IN THE PRESENT CASE ALSO THE ASSESSEE DURING THE ORIGINAL ASSESSMENT , ITS PRIMARY ONUS ESTABLISHING THE IDENTITIES OF THE SAI D TWO COMMISSION AGENT AND ALSO EVIDENCE HAS BEEN BROUGHT ON RECORD THAT THE COMMIS SION WAS ACTUALLY PAID BY ACCOUNT PAYEE CHEQUES AND THE SAME HAS NOT BEEN DE NIED BY THE REVENUE. IT IS ALSO A FACT THAT DURING THE COURSE OF ORIGINAL ASSE SSMENT PROCEEDINGS, THE AO STARTED THE ASSESSMENT PROCEEDINGS JUST TWO MONTHS BEFORE T HE EXPIRY OF LIMITATION. THE AO HAS MENTIONED IN PARA-2 TO 5 OF HIS ORDER STATING THAT NO DOUBT THE ASSESSEE HA D MADE REQUEST TO EXAMINE THE COMMISSION AGENT BUT AS SESSMENT IS GETTING TIME BARRED BY 31-03-1986 SO HE WAS UNABLE TO EXAMINE TH E PARTIES OR COMMISSION AGENTS. SIMILAR STORY WAS REPEATED BY THE CIT(A), WHEN THE TRIBUNAL HAS SET ASIDE THE ASSESSMENT ON 13-03-1992. THE CIT(A) COMPLETED THE SET ASIDE APPELLATE PROCEEDINGS ONLY ON 23-12-2008 I.E. THERE IS DELAY AND LATCHES BY ALMOST 16 YEARS. NOW CAN REVENUE ASK FOR THE EXAMINATION OF WITNESSE S AFTER SUCH A LONG GAP. THE VIEW HELD BY HONBLE CALCUTTA HIGH COURT IN THE CAS E OF MATHER & PLATT (INDIA) LTD. ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 7 (SUPRA) THAT DURING THE COURSE OF ORIGINAL ASSESSME NT PROCEEDINGS, THE ASSESSEE HAS FILED THE COMPLETE DETAILS LIKE IDENTITY, GENUINENE SS AND TRANSACTIONS AND ALSO PROVED THE COMMISSION PAYMENT, THERE IS NOTHING LEFT TO EX AMINE FURTHER AND THE CLAIM OF THE ASSESSEE IN THE GIVEN FACTS AND CIRCUMSTANCES OF TH E ASSESSEES CASE IS TO BE ALLOWED. ACCORDINGLY, THIS COMMON ISSUE IN THE APP EALS OF THE ASSESSEE IN THREE YEARS IS ALLOWED. 8. THE ONLY ISSUE IN THIS APPEAL OF ASSESSEE IN ITA NO.1132/AHD/2009 IN ASSESSMENT YEAR 1985-86 IS AS REGARDS TO THE DISALL OWANCE OF CLAIM OF BAD DEBTS. FOR THIS, THE ASSESSEE HAS RAISED THE RELEVANT GROUND NO.3 AS UNDER:- 3. THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN CONFIRMING THE DISALLOWANCE OF BAD DEBTS WRITTEN OFF OF RS.265000/ - FOR THE REASON THAT NO EVIDENCE WAS FILED SHOWING THE DEBT HAS BECOME BAD. IN THE FATS & CIRCUMSTANCES OF THE CASE IT IS SUBMITTED THAT ALL THE RELEVANT DETAILS SHOWING THE DEBT HAD BECOME BAD HAD BEEN FILED BEFORE THE C IT(A) AND ON THAT BASIS THE DEDUCTION WAS ALLOWABLE. IT IS SUBMITTED IT BE SO HELD NOW. 3.1 THE COMMISSIONER OF INCOME TAX (APPEALS) ERRED IN HOLDING THAT THE APPELLANT HAS NOT FULFILLED THE CONDITIONS OF SECTI ON 36(2) OF THE ACT. IN THE FACTS & CIRCUMSTANCES OF THE CASE IT IS SUBMITTED T HAT THE APPELLANT HAS FULFILLED THE CONDITIONS OF SECTION 36(2) OF THE AC T. IT IS SUBMITTED IT BE SO HELD NOW. 9. AFTER HEARING THE RIVAL CONTENTIONS AND GOING TH ROUGH THE CASE RECORDS, WE FIND THAT THE TRIBUNAL EARLIER RECORDED BASIS FOR T HE DISALLOWANCE OF BAD DEBT / DAMAGES DUE FROM HEAVY ENGINEERING CORPORATION RANC HI. THE TRIBUNAL RECORDED A FINDING THAT CIT(A) WAS OF THE OPINION THAT WHEN TH E CONTRACTOR DECIDES TO DEDUCT THE DAMAGES AND QUANTIFIED THE SAME, THE ASSESSEE BECAM E AWARE OF DEDUCTION OF THE LIABILITY SAID TO HAVE ARISEN BUT FROM THE EVIDENCE S PRODUCED BEFORE HIM, THE CIT(A) OPINED THAT IT IS NOT PROVED BY ANY EVIDENCE FROM H EAVY ENGINEERING CORPORATION RANCHI THAT THERE WAS NO INTIMATION FROM THAT CONCE RN DURING THAT YEAR FOR DEDUCTION OF LIQUIDATE DAMAGES / BAD DEBTS. THE TRIBUNAL SET ASIDE THE ISSUE VIDE PARA-10 AS UNDER:- 10. IN OUR OPINION, THE MATTER SHOULD BE RESTORED BACK TO THE FILE OF THE LD. CIT(A). IT APPEARS THAT HE WAS OF THE VIEW THAT THE RE WAS NO ACCEPTANCE ON THE PART OF HEC IN THIS RESPECT THAT RS.2,65,000/- ARE NOT GOING TO BE PAID BY THEM TO THE ASSESSEE. THE OPINION OF THE LD. CIT(A) , IT APPEARS, IS MAINLY ON THE BASIS THAT THERE WAS NO ACKNOWLEDGEMENT ON THE PART OF HEC IN THIS RESPECT. IN OUR VIEW, IF THE ACCOUNTS HAD BEEN CONF IRMED BY HEC, THEN IT IS A CONSTRUCTIVE ACKNOWLEDGEMENT. THIS MATTER HAS THERE FORE TO BE LOOKED FROM ITA NO.1130-32/AHD/2009 A.Y.S 1983-84 TO 1985-86 BOSCH REXROTH (I) LTD. V. DCIT, R-1, ABD PAGE 8 ALL THESE ANGLES BUT AFTER PROPER ASCERTAINMENT OF THE FACTS. THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES AS A TOOL FOR REDU CING THE TAX LIABILITY BY CLAIMING HIGHER COMMISSION AND THE NET GROUND IS IN RESPECT OF DISALLOWANCE U/S.43B. IT IS CLAIMED BY THE ASSESSEES COUNSEL TH AT THE PAYMENT HAD BEEN MADE BEFORE THE DUE DATE OF FILING OF RETURN OF INC OME FOR THE ASST. YEAR UNDER CONSIDERATION. IN OUR VIEW, THE ASSESSEES CONTENTI ON HAS TO BE ACCEPTED. HOWEVER, PAYMENT SHOULD BE VERIFIED AND FOR THAT PU RPOSE THE MATER IS RESTORED TO THE FILE OF THE AO. 10. WE FIND FROM THE ARGUMENTS OF BOTH THE SIDE AND FROM THE CASE RECORDS THAT THE TRIBUNAL HAS ALREADY SET ASIDE THE ISSUE TO THE FILE OF THE ASSESSING OFFICER, WE FIND NO INFIRMITY IN THE SAME. ACCORDINGLY, THIS I SSUE OF THE ASSESSEES APPEAL IS DISMISSED. 11. IN THE RESULT, THE ASSESSEES APPEALS IN ITA NO.1130-1131/AHD/2009 ARE ALLOWED AND ITA NO.1132/AHD/2009 IS PARTLY. ORDER PRONOUNCED IN OPEN COURT ON 04/09/2009 SD/- SD/- (P.K.BANSAL) (MAHAVIR SINGH) ACCOUNTANT MEMBER JUDICIAL MEMBER AHMEDABAD, DATED : 04/09/2009 *DKP COPY OF THE ORDER FORWARDED TO : 1. THE APPELLANT. 2. THE RESPONDENT. 3. THE CIT(APPEALS)-VI, AHMEDABAD 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, /TRUE COPY/ DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD