The DCIT, Circle-1, RAJKOT-GUJARAT V. Rollex Rings Pvt. Ltd., RAJKOT-GUJARAT

ITA 1256/RJT/2010

• Counselvise Citation: [2014] 140 COUNSELVISE.COM (IT) 85414 (ITAT-RAJKOT)
• Duration Of Justice: 4 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 25-11-2014
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: DB
• Next Hearing Date: 24-11-2014
• Assessment Year: 2007-2008
• Appeal Filed On: 08-11-2010
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: AVINESH KUMAR
• Assessee Lawyers: RD LALCHANDANI
• Keywords: Income from undisclosed sources; Document seized; Corroborative evidences; Valuation report; Retraction; Documents seized
• Section: 133A; 69

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL AT RAJKOT . . , , , BEFORE S/SHRI G.C. GUPTA, VICE - PRESIDENT AND ANIL CHATURVEDI, ACCOUNTANT MEMBER) ITA NO . 1256 / RJT /20 1 0 WITH CO NO.10/RJT/2011 [ASSTT.YEAR : 200 7 - 200 8 ] DCIT, CIR.1 RAJKOT / VS. ROLLEX RINGS P. LTD. GONDAL ROAD VILL: KOTHARIYA RAJKOT. PAN : AACCR 3790 B ( / APPELLANT) ( / RESPONDENT) / ASSESSEE BY : SHRI R.D. LALCHANDANI / REVENUE BY : SHRI AVINESH KUMAR, DR / DATE OF HEARING : 24 TH NOVEMBER, 2014 / DATE OF PRONOUNCEMENT : 25/11/2014 / O R D E R PER ANIL CHATURVEDI , ACCOUNTANT MEMBER : TH IS APPEAL BY THE REVENUE AND THE CO BY THE ASSESSEE ARE AGAINST THE ORDER OF THE CIT(A) DATED 2.8.2010 F OR THE ASSTT.YEAR 200 7 - 200 8. THESE ARE DISPOSED OF BY THIS CONSOLIDATED ORDER. 2. THE RELEVANT FACTS AS CULLED OUT FROM THE MATERIAL ARE AS UNDER: ITA NO. 1256 / RJT /20 1 0 WITH CO - 2 - THE ASSESSEE IS A COMPANY STATED TO BE ENGAGED IN THE BUSINESS OF MANUFACTURING OF FORGING ARTICLES. IN THIS CASE, A SURVEY ACTION UNDER SECTION 133A OF THE ACT WAS CONDUCTED AT THE BUSINESS PREMISES OF THE ASSESSEE ON 28.3.2007. THE AO HAS NOTED THAT DURING THE COURSE OF SURVEY PROCEEDINGS ON THE BASIS OF INCRIMINATING MATERIAL AND DOCUMENTS, THE DIRECTOR MADE TOTAL DISCLOSURE OF UNACCOUNTED INCOME AMOUNTING TO RS.10.10 CRORES ON ACCOUNT OF UNDISCLOS ED INVESTMENT IN LAND (RS.3.75 CRORES), UNA C COUNTED INVESTMENT IN NEW BUILDING (RS.2 CRORES) AND INVESTMENT IN CONSTRUCTION OF ROAD, MACHINERY REPAIRING ETC. (RS.4.26 CRORE). HOWEVER, IN THE RETURN OF INCOME FILED BY THE ASSESSEE ON 26.10.2007, THE TOTAL INCOME WAS DECLARED AT NIL. THE ASSESSMENT WAS THEREAFTER FRAMED U/S.143(3) VIDE ORDER DATED 24.12.2009 AND THE TOTAL INCOME WAS DETERMINED AT RS.10.10 CRORES. 3. AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE CARRIED THE MATTER BEFORE THE CIT(A) WHO VIDE ORDER DATED 2.8.2010 GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY THE ORDER OF THE CIT(A), THE REVENUE IS NOW IN APPEAL BEFORE US AND THE ASSESSEE HAS ALSO FILED A CO. THE GROUND RAISED BY THE REVENUE IN ITS APPEAL READS AS UNDER: 1. THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.10,10,00,000/ - MADE UNDER SECTION 69 OF THE ACT. 4 . BRIEF FACTS EMERGING FROM THE RECORD OF THE REVENUE AUTHORITIES ARE THAT SURVEY PROCEEDINGS UNDER SECTION 133A OF THE ACT WAS CONDUCTED AT THE BUSINESS PREMISES OF THE ASSESSEE ON 28.3.2007. BASED ON TWO DAIRIES FOUND DURING THE COURSE OF SURVEY, THE ASSESSEE IS SAID TO HAVE DISCLOSED A SUM OF RS.10,10,00,000/ - AS UNDISCLOSED INCOME . THE SAID DISCLOSURE WAS SUBSEQUENTLY , WI THIN 10 DAYS I.E. ON 10.4.2007 , RETRACTED BY THE ASSESSEE INTER ALIA FOR THE REASONS THAT ALL THE ASSETS WERE EXPLAINED AND RECORDED IN ITA NO. 1256 / RJT /20 1 0 WITH CO - 3 - THE BOOKS OF ACCOUNTS. THE AO , BASED ON THE ORAL STATEMENT OF THE DIRECTOR OF THE ASSESSEE , REJECTED THE STAND OF THE A SSESSEE AND MADE IMPUGNED ADDITION OF RS.10.10 CRORES . THE ASSESSEE WENT IN FIRST APPEAL, AND THE CIT(A) AFTER DETAILED DISCUSSION ON THE E XPLANATION MADE BY THE ASSESSEE, REMAND REPORT OF THE AO AND THE ASSESSEE S COMMENTS ON REMAND REPORT AND ON THE BAS IS OF THE MATERIAL PLACED ON RECORD DELETED THE IMPUGNED ADDITION BY FOLLOWING RELEVANT OBSERVATION S : 8 I HAVE CAREFULLY CONSIDERED THE ISSUE AND 1 HAVE ALSO GONE THROUGH THE CASE RECORDS AND THE SURVEY FOLDER. IT IS SEEN THAT SURVEY WAS STARTED ON 28/ 03/07 AND FROM THE DATES MENTIONED ON SIGNATURES ON THE STATEMENT, IT IS APPARENT THAT THE RECORDING OF STATEMENT WAS DONE IN THE LATE NIGHT OF 28/03/07 AND IT CONTINUED TILL THE MORNING OF 29TH MARCH, 2007. IT IS RELEVANT TO NOTE THAT THE ASSESSEE RETRACT ED THE SURRENDER MADE WITHIN 10 DAYS BY WRITING A LETTER TO THE INVESTIGATION WING STATING THAT THE SURRENDER WAS NOT VOLUNTARY AND THAT THE ALLEGED DOCUMENTS WERE GOT WRITTEN BY A PERSON, WHO WAS NOT IN EMPLOYMENT OF THE' ASSESSEE DURING THE PERIOD, TO WH ICH THE ALLEGED DOCUMENT PERTAINED TO. THE ASSESSEE ALSO FILED COMPLETE DETAILS STATING THAT ALL THE RELEVANT ITEMS WERE DULY RECORDED IN THE BOOKS OF THE ASSESSEE AND IN FACT THERE. WAS NO UNDISCLOSED INVESTMENT OR EXPENDITURE. AFFIDAVITS TO THIS EFFECT W AS ALSO FILED. HOWEVER, NEITHER THE INVESTIGATION WING NOR THE A O , AT THE TIME OF ASSESSMENT, CHOOSE TO EXAMINE THE DEPONENT OR TRIED TO VERIFY THE DETAILS SUBMITTED BY THE ASSESSEE. IN SUCH A SITUATION BASING THE ENTIRE ADDITION ON A RETRACTED SURRENDER WAS NOT PROPER. . . 9 .. THE ABOVE IN ITSELF SHOWS THAT THERE IS NO LINK AT ALL BETWEEN THE ENTRIES AND THE AMOUNT AND TYPE OF ITEMS FOR WHICH THE ALLEGED SURRENDER WAS MADE. THE SURRENDER WAS MADE ON ACCOUNT OF INVESTMENT IN BUILDING FURNACE, ELECTRICAL ITEMS, MACHINERY REPAIRS AND CONSTRUCTION OF ROADS ETC. FIRST OF ALL IF THE ITEMS NOTED IN THESE ANNEXURES ARE SEEN, IT IS NOT KNOWN AND NO QUESTION WAS EVER ASKED IN THE STATEMENT WHETHER THESE ITEMS ARE IN RUPEES OR THOUSANDS OR LAKHS. THE WAY OF STATEMENT RECORDED SHOWS THAT THE ITEM WAS PROBABLY TAKEN AS IN LAKHS AND THE ENTIRE DETAILS WOULD SHOW THAT IF IT IS WORKED OUT ON THE BASIS OF LAKHS, COST OF SAND WAS ALMOST RS. 3.5 CRORE AS PER ITA NO. 1256 / RJT /20 1 0 WITH CO - 4 - ANNEXURE A - L AND 4 CRORE OR 4 LAKHS, WHICH IS UNKNOWN, AS PER ANNEXURE A - 4. IF SO MUCH SAND TO BE USED, THEN AP PARENTLY COST OF CONSTRUCTION OF BUILDING SHOULD EXCEED MORE THAN RS. 60 CRORE. THIS FACT THAT, IT IS NOT KNOWN AS TO WHAT THESE FIGURES ACTUALLY MEAN, WAS ALSO BROUGHT TO THE NOTICE OF THE AO AS WELL AS THE ADD L CIT DURING THE COURSE OF ASSESSMENT PROC EEDINGS AND PROCEEDINGS U/S.144A OF THE ACT. IN THE APPLICATION U/S.144A DTD. 24/11/2009 THESE FACTS WERE CLEARLY BROUGHT TO THE NOTICE OF THE ADDL.CIT THAT NONE OF THE FIGURES MATCH. IT IS FOUND TO BE TRUE THAT ENTRIES IN THE DIARY DO NOT CORRESPOND TO THE ALLEGED SURRENDER MADE. IN THE DIARY THE ENTRIES ARE BASICALLY OF SAND, GRID, IRON AND COLOUR. IT NOWHERE SUGGEST THAT ANY ITEM PERTAINS TO REPAIRS OF MACHINERY AND, THEREFORE, THE SURRENDER MADE IN ANSWER TO QN.NO.32 AND 31 NOWHERE MATCH WITH THESE FI GURES AND IT CAN BE SAFELY SAID THAT THE ALLEGED SURRENDER MADE IN THE STATEMENT IS NOT SUPPORTED BY - ANY OF THE ENTRIES MADE IN THE DOCUMENTS IMPOUNDED DURING SURVEY PROCEEDINGS AND SINCE THERE IS NO CORROBORATIVE EVIDENCE, AND THE ASSESSEE HAS RETRACTED T HE SURRENDER BY GIVING FULL DETAILS, THE ADDITION CANNOT BE SAID TO BE PROPER. 10. NOW COMING TO THE ITEMS OF SURRENDER AND EVIDENCES PRODUCED BY THE ASSESSEE. IT MAY BE POINTED OUT THAT THE ASSESSEE HAS CLEARLY DEMONSTRATED THAT ITS INVESTMENT IN BOTH T HE UNITS I.E. A BUILDING, ROADS OR MACHINERIES WAS FULLY RECORDED IN THE BOOKS OF ACCOUNT TILL THE DATE OF SURVEY ITSELF. TO SUPPORT THE COST OF CONSTRUCTION, ETC. THE ASSESSEE HAD ALSO FILED A VALUATION REPORT. IF SUCH VALUATION REPORT WAS FILED, THEN IF THE AO WAS NOT SATISFIED, THE MATTER COULD HAVE BEEN REFERRED TO THE VALUATION CELL. BUT THAT HAS NOT BEEN DONE AT ALL AND THE AO HAS SIMPLY IGNORED THIS. THIS IS NOT PROPER BECAUSE WHEN THE ASSESEE SAYS THAT ENTIRE COST IS RECORDED IN BOOKS OF ACCOUNTS, WHICH IS SUPPORTED BY A VALUATION REPORT, THEN MERELY ON THE BASIS OF RETRACTED SURRENDER NO SUCH ADDITION WAS PERMISSIBLE WHEN THERE WAS NO EVIDENCE TO CORROBORATE THE SURRENDER. SIMILARLY, SO FAR AS INVESTMENT IN THE OLD MACHINES, PLANT & MACHINERY ARE C ONCERNED, ALL OF THEM HAVE BEEN PURCHASED FROM INTERNATIONAL PARTIES OR WELL KNOWN INDIAN CONCERNS, TO WHOM PAYMENTS HAVE BEEN MADE BY CHEQUE AND IN MOST OF THE CASES MUCH BEFORE THE DATE OF SURVEY. THEREFORE, THERE CAN BE NO OCCASION OF ANY UNDISCLOSED IN VESTMENT IN THESE ITEMS. THE ASSESSEE HAS ALSO STATED THAT EVEN AMOUNT OF REPAIRS ARE PROPERLY DEBITED IN THE BOOKS OF ACCOUNTS AND IN THE DOCUMENTS IMPOUNDED THERE IS NO REFERENCE OF ANY SUCH AMOUNT RELATED TO REPAIRS OF MACHINERY. THE ASSESSEE HAS ALSO C LEARLY DEMONSTRATED THAT SUBSTANTIAL AMOUNT OF ITS MACHINERY ARE NEW AND PURCHASED FROM JAPAN AND THEREFORE, EVEN OTHERWISE THERE CAN NOT ITA NO. 1256 / RJT /20 1 0 WITH CO - 5 - BE SO MUCH AMOUNT TO BE SPENT ON REPAIRS AND ALL THE REPAIRS AND DETAILS AND VOUCHERS WERE AVAILABLE IN HARD DISC SEIZ ED BY THE OFFICERS DURING THE COURSE OF SURVEY. SUMMARY OF THESE DETAILS HAVE ALREADY BEEN INCORPORATED IN APPELLANT'S SUBMISSIONS, WHICH HAVE ALREADY BEEN INCORPORATED EARLIER IN THIS ORDER AND HENCE ARE NOT BEING REPEATED HERE. ALL THESE GO TO SHOW THAT ENTIRE DETAILS WERE AVAILABLE WITH THE A O AND THE DEPARTMENT, WHICH WERE CONTAINED IN THE HARD DISC SEIZED AT THE TIME OF SURVEY AND THE ASSESSEE HAS GIVEN FULL EXPLANATION FOR ALL THE ITEMS WHICH WERE ALLEGEDLY SURRENDERED DURING THE COURSE OF STATEMENT U /S.133A. THIS SURRENDER WAS RETRACTED BY WAY OF AN AFFIDAVIT. IT IS ALSO NOTICED THAT NONE OF THE ENTRIES NOTED IN THE IMPOUNDED DOCUMENTS CORRESPOND TO THE AMOUNT OF ALLEGED SURRENDER AND IT CAN BE SAFELY SAID THAT THERE WAS NO EVIDENCE TO BACK THE ALLEGE D SURRENDER. IN SUCH CIRCUMSTANCES, THE ASSESSEE WAS WELL WITHIN ITS RIGHTS TO RETRACT THE SURRENDER AS HELD IN VARIOUS CASES, WHICH HAS BEEN DISCUSSED EARLIER. 11. THE ENTIRE DISCUSSION ABOVE SHOWS THAT THE ASSESSEE WAS WELL WITHIN ITS RIGHTS TO RETRACT ITS SURRENDER, THERE WAS NO EVIDENCE IN THE SEIZED DOCUMENTS WHICH COULD CORROBORATE THE ALLEGED SURRENDER. THE ASSESSEE HAD GIVEN COMPLETE DETAILS BOTH AT THE TIME OF ASSESSMENT AS WELL AS DURING THE COURSE OF PROC E EDINGS U/S.144A; TO SHOW THAT NONE OF SUCH AMOUNT WHICH WAS ALLEGEDLY DISCLOSED IN THE STATEMENT WAS UNEXPLAINED. TO SUM UP, THERE WAS NO BASIS FOR THIS ADDITION, AND RETRACTION OF ASSESSEE WAS PERMISSIBLE A ND WELL WITHIN THE LAW, AS HELD IN VARIOUS DECISIONS WHICH HAVE BEEN DISCUSSED EARLIER. IN VIEW OF THESE, THE ADDITION OF RS.10,10,00,000 (RS.10.10 CRORES) MADE BY THE AO ON THE BASIS OF RETRACTED SURRENDER, IS DELETED., 5 . AGGRIEVED BY THE ORDER OF THE CIT(A) REVENUE IS NOW IN APPEAL BEFORE US. BEFORE US, T HE LEARNED DR SUBMITTED THAT THE ADDITION WAS MADE BASED ON THE MATERIAL FOUND DURING THE COURSE OF SURVEY, WHICH CLEARLY INDICATES UNDISCLOSED INVESTMENT MADE BY THE ASSESSEE. HE SUBMITTED THAT THE ASSESSEE HAS NOT DENIED THE INVESTMENTS AND THE ASSESSEE WAS NOT ABLE TO PROVE THAT THE INVESTMENTS WERE REFLECTED IN THE IMPOUNDED DOCUMENTS AS PART OF THE REGULAR BOOKS OF THE ACCOUNTS. IT IS SUBMITTED THAT THE ASSESSEE COULD NOT EXPLAIN THE ENTRIES APPEA R ING IN THE DOCUMENTS ITA NO. 1256 / RJT /20 1 0 WITH CO - 6 - IMPOUNDED DURING THE SURVEY. IT IS FURTHER SUBMITTED THAT STATEMENT OF THE DIRECTOR OF THE ASSESSEE COMPANY WAS RECORDED AS PER THE LAW AFTER FOLLOWING DUE PROCESS OF LAW, AND THAT TOO WITHOUT ANY COERCION, THREAT, PR ESSURE OR ANY UNDUE INFLUENCE, AND THE STATEMENT GIVEN BY SHRI MADEKA , THE DIRECTOR, DURING THE COURSE OF SUR V EY OPERATION WAS VOLUNTARY ACT, AND THE ADDITION WAS RIGHTLY MADE BY THE AO. HE RELIED ON THE ORDER OF THE AO. 6 . THE LEARNED COUNSEL FOR THE ASSESSEE S UBMITTED THAT THE STATEMENT MADE BY THE DIRECTOR OF THE ASSESSEE COMPANY WAS RETRACTED WELL WITHIN 10 DAYS AFTER THE SURVEY. THE STATEMENT OF THE DIRECTOR OF THE COMPANY WAS BASED ON THE NOTINGS MADE IN THE BOOKS BY ONE OF THE STAFF MEMBER, MR. JETHAL AL A DTANEE WHO HAS VERY RECENTLY JOINED THE ASSESSEE (I.E. ON 1/1/2007) AND HE WAS NOT AWARE OF THE MONEY SPENT DURING THAT PERIOD MENTIONED IN THE NOTE BOOKS. IT IS SUBMITTED THAT THE EMPLOYEE HIMSELF OFFERED TO APPEAR BEFORE THE DEPARTMENT TO EXPLAIN THE DE TAILS IN THE SEIZED BOOKS AND TO EXPLAIN THE CIRCUMSTANCES IN WHICH THESE NOTINGS WERE MADE , WHICH THE DEPARTMENT DID NOT DO SO . IT IS SUBMITTED THAT NO INVESTMENT HAS BEEN WITHOUT RECORDING IN THE BOOKS OF ACCOUNTS. IN FACT THE ASSESSEE HAS FILED COMPL ETE DETAILS THAT ALL THE RELEVANT ITEMS AND THERE WAS NO UNDISCLOSED INVESTMENT OR EXPENDITURE. THE ADDITION HAS BEEN MADE BY THE AO SIMPLY ON THE BASIS OF STATEMENT OF THE DIRECTOR WITHOUT ANY CORROBORATIVE EVIDENCES. THE LEARNED AR RELIED ON THE DECISI ON OF THE HON BLE APEX COURT , IN THE CASE OF CIT VS. S. KADER KHAN, 300 ITR 157 (MAD) WHEREIN THE HON BLE SUPREME COURT DISMISSED THE SLP FILED BY THE DEPARTMENT CHALLENGING THE ORDER OF THE HON BLE MADRAS HIGH COURT BY HOLDING THAT SU R VEY STATEMENT UNDER SECTION 133A HAS NO EVIDENTIARY VALUE. THE LEARNED COUNSEL FOR THE ASSESSEE DRAWN OUR ATTENTION TO RELEVANT ITA NO. 1256 / RJT /20 1 0 WITH CO - 7 - PORTIONS OF THE CIT(A) S ORDER IN SUPPORT OF ITS CASE. HE RELIED ON THE ORDER OF THE CIT(A). 7 . WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSED THE ORDERS OF THE REVENUE AUTHORITIES AND ALSO MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE ENTIRE ADDITION MADE BY THE AO IS BASED ON THE STATEMENT OF ONE DIRECTOR OF THE ASSESSEE COMPANY MADE DURING THE SURVEY PROCEEDINGS UNDER SECTION 133A OF THE ACT , WHICH WAS LATER ON RETRACTED. WE FIND THAT THE CIT(A) WHILE DELETING THE ADDITION HAS GIVEN A FINDING THAT THE ASSESSEE HAD FILED COMPLETE DETAILS STATING THAT ALL THE RELEVANT ITEMS WERE DULY RECORDED IN THE BOOKS OF THE ASSESSEE AND IN FACT THERE WAS NO UNDISCLOSED INVESTMENT OR EXPENDITURE, AND THAT AFFIDAVITS TO THIS EFFECT WAS ALSO FILED. IT IS FURTHER RECORDED BY THE CIT(A) THAT NEITHER THE INVESTIGATION WING NOR THE AO, AT THE TIME OF ASSESSMENT, CH OOSE TO EXAMINE THE DEPONENT OR TRIED TO VERIFY THE DETAILS SUBMITTED BY THE ASSESSEE. WE FURTHER FIND THAT THE LD.CIT(A) AFTER CONSIDERING THE DOCUMENTS IMPOUNDED HAS GIVEN A FACTUAL FINDING THAT THE ALLEGED SURRENDER MADE IN THE STATEMENT IS NOT SUPPORT ED BY ANY OF THE ENTRIES MADE IN THE DOCUMENTS IMPOUNDED DURING SURVEY PROCEEDINGS, AND THEREFORE, ADDITION IS NOT PROPER. IT IS SETTLED POSITION OF THE LAW THAT ADMISSION BY AN ASSESSEE IS AN IMPORTANT PIECE OF EVIDENCE, BUT AT THE SAME TIME, IT IS NOT CO NCLUSIVE. WE FURTHER FIND THAT THE CIT(A), AFTER CONSIDERING THE SUBMISSIONS OF THE ASSESSEE AND VARIOUS MATERIALS PLACED ON THE RECORD, HAS GIVEN A FINDING THAT THE ASSESSEE HAS CLEARLY DEMONSTRATED THAT THE INVESTMENT MADE IN BOTH THE UNITS I.E. A BUI LD ING , ROADS OR MACHINERIES WAS FULLY RECORED IN THE BOOKS OF ACCOUNTS TILL THE DATE OF SURVEY ITSELF AND THAT THE ENTI R E DETAILS WERE AVAILABLE WITH THE AO AND THE DEPARTMENT, WHICH WERE CONTAINED IN THE HARD DISK SEIZED AT THE TIME OF SURVEY AND THE ASSESS EE HAS GIVEN FULL EXPLANATION FOR ALL THE ITEMS ITA NO. 1256 / RJT /20 1 0 WITH CO - 8 - WHICH WERE ALLEGED SURRENDERED DURING THE COURSE OF STATEMENT UNDER SECTION 133A. BEFORE US, THE REVENUE HAS NOT BROUGHT ANY MATERIAL ON RECORD TO CONTROVERT THE FINDINGS OF THE LD.CIT(A). WE FURTHER FIND T HAT WHEN THE A DDITION WAS MERELY ON BASIS OF ADMISSION MADE DURING SEARCH, WHICH WAS SUBSEQUENTLY RETRACTED AND ALSO EXPLAINED CIRCUMSTANCES UNDER WHICH THE STATEMENT HAS BEEN MADE SUPPORTED BY THE EVIDENCES, THERE IS NO JUSTIFICATION FOR THE DEPARTMENT TO MAKE THE IMPUGNED ADDITION , WHICH WAS RIGHTLY DELETED BY THE CIT(A). IN THESE FACTS OF THE CASE, WE CONFIRM THE ORDER OF THE CIT(A) ON THIS ISSUE, AND REJECT THE GROUND OF THE APPEAL OF THE REVENUE. 8 . IN THE RESULT, THE APPEAL OF THE REVENUE IS DISMISSED. 9 . WE NOW TAKE UP THE ASSESSEE S CO. THE ONLY GROUND OF THE CO OF THE ASSESSEE IS AS UNDER: THE AO ERRED IN REFUSING TO SET OFF THE CURRENT YEAR S LOSSES AND THE CARRY FORWARD LOSSES. THE DIRECTIO N TO CARRY FORWARD LOSSES WITHOUT SETTING OFF AGAINST CURRENT INCOME IS NOT JUSTIFIED . 10 . AFTER HEARING BOTH THE SIDE, SINCE WE HAVE DISMISSED THE APPEAL OF THE REVENUE CHALLENGING THE DELETION OF ADDITION MADE BY THE AO OF RS.10.10 CRO R ES UNDER SECTION 69 OF THE ACT, AS PER THE DISCUSSION IN THE FOREGOING PARAS OF THIS ORDER, WE FIND NO NEED TO ADJUDICATE THIS CO, AND THE CO IS ACCORDINGLY DISMISSED. 9 . IN THE RESULT, APPEAL OF THE REVENUE AND CO OF THE ASSESSEE ARE DISMISSED . ORDER PRONOUNCED IN OPEN COURT ON THE DATE MENTIONED HEREINABOVE. SD/ - SD/ - ( . . /G.C. GUPTA) /VICE - PRESIDENT ( / ANIL CHATURVEDI) /ACCOUNTANT MEMBER ITA NO. 1256 / RJT /20 1 0 WITH CO - 9 - C OPY OF THE ORDER FORWARDED TO: 1) : APPELLANT 2) : RESPONDENT 3) : CIT(A) 4) : CIT CONCERNED 5) : DR, ITAT. BY ORDER AR, ITAT, RAJKOT