ITO, New Delhi V. Net Healthcare Services (P) Ltd., Delhi

ITA 180/DEL/2016

• Counselvise Citation: [2019] 118 COUNSELVISE.COM (IT) 5477 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 05-02-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: F
• Assessment Year: 2010-2011
• Appeal Filed On: 13-01-2016
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained cash credit; Business income; Share purchase agreement; Additional evidence; Assessment record
• Section: 68; 144; 143(1)

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO. 180/DEL/2016 A.Y. : 2010-11 ITO, WARD 18(1), NEW DELHI VS. NET HEALTCARE SERVCIES (P) LTD. 572, 2 ND FLOOR, GANDHI CLOTH MARKET, CHANDNI CHOWK, DELHI (PAN: AACCN6291P) (ASSESSEE) (RESPONDENT) REVENUE BY : MS. RINKU SINGH, SR. DR. ASSESSEE BY : NONE ORDER PER H.S. SIDHU : JM THE REVENUE HAS FILED THIS APPEAL AGAINST THE IMPUGN ED ORDER DATED 30.10.2015 OF THE LD. CIT(A)-42, NEW DELHI RELE VANT TO ASSESSMENT YEAR 2010-11. 2. THE GROUNDS RAISED IN THE APPEAL READ AS UNDER:- I) WHETHER FACTS AND CIRCUMSTANCES OF THE CASE AND IN L AW THE LD. CIT(A) IS JUSTIFIED IN DELETING ADDITION OF RS . 20 2 LAKHS AND RS. 2.81 CRORE BY ADMITTING ADDITIONAL EVID ENCE UNDER RULE 46A OF INCOME TAX RULE, 1962 (THE RULE) E VEN WHEN THE ASSESSEE WAS NOT PREVENTED BY SUFFICIENT CAU SE FROM PRODUCING BOOKS OF ACCOUNTS AND EVIDENCE WITH REGARDS TO IDENTITY, GENUINENESS AND CREDITWORTHINESS OF INVESTOR OF SHARE APPLICATION MONEY? II) WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD CIT(A) IS JUSTIFIED IN ADMITTING ADDITION AL EVIDENCE UNDER RULE 46A OF THE RULE ONLY ON THE BASI S OF SELF SERVING AND UNPROVEN CLAIMS BY THE ASSESSEE AND IGNORING RATIO DECIDENDI AS LAID DOWN ON THE SIMILAR ISSUE OF NON COOPERATION BY THE ASSESSEE DURING ASSESSMEN T PROCEEDINGS BY HON'BLE DELHI HIGH COURT IN CASE OF CIT V GOLD LEAF CAPITAL CORPORATION LTD (2013) 353 ITR 163 (DELHI) AND HON'BLE SUPREME COURT IN THE CASE OF SA LIL DUTTA V T.M AND M.C. PRIVATE LTD 1993-002 SCC-185-SC? III) WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE A ND IN LAW, THE LD CIT(A) IS JUSTIFIED IN DELETING ADDITION OF RS. 2.81 CRORE ON ACCOUNT OF UNEXPLAINED SHARE APPLICATI ON MONEY WITHOUT CONSIDERING HIS OWN FINDING THAT THE ASSESSEE DID NOT CARRYOUT OF ANY BUSINESS ACTIVITY AND HAD NO SOURCE OF INCOME I.E. THE ASSESSEE HAD NO WOR TH AS WELL AS FOLLOWING FINDINGS AS EVIDENT FROM REMAND REPORT DATED 09.09.2015: NO EVIDENCE OF CREDITWORTHINESS OF INVESTORS INVESTING RS. 2.95 CRORE AS SHARE APPLICATION MONEY W AS FILED; 3 EVEN AUDIT REPORT OF INVESTING COMPANIES (TOTAL INVESTMENT OF RS. 95.66 LAKHS) WAS NOT FILED; AND COPIES OF BANK A/C OF INVESTORS INDICATED DEPOSI T OF CASH OR CHEQUE IMMEDIATELY BEFORE INVESTMENT IN SHARE APPLICATION MONEY? 4. WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) IS JUSTIFIED IN DELETING ADDI TION OF RS. 2.81 CRORE U/S 68 OF THE ACT BY WRONGLY QUOTING THE AO THAT THE ASSESSEE HAD FILED COPIES OF AUDIT REPORTS, BOARD'S RESOLUTIONS AND AFFIDAVIT AFFIRMED BY THE DIRECTORS OF THE 15 INVESTOR COMPANIES DURING REMAND PROCEEDINGS? 5. WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW LD. CIT (A) IS JUSTIFIED IN DELETING ADDITION OF RS. 2.81 CRORE ON ACCOUNT OF UNEXPLAINED SHARE APPLICATION MONEY WITHOUT MAKING FURTHER ENQUIRY AS DIRECTED BY HON'BLE DELHI HIGH COURT IN CASE OF CIT V JANSAMPARK ADVERTISING AND MARKETING P. LTD (2015) 375 ITR 373 (DEL) AND WITHOUT ANALYZING COPIES OF BANK ACCOUNT AND DOCUMENT AS PROVIDED BY THE AO ALONWITH REMAND REPORT? 6. WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW THE LD CIT(A) IS JUSTIFIED IN DELETING ADDITI ON OF RS. 2.81 CRORE ON ACCOUNT OF UNEXPLAINED SHARE APPLICATION MONEY BY HOLDING THAT CREDITWORTHINESS WAS PROVED BY MERE PRODUCTION OF DETAILS OF INCOME TAX RETURN DETAILS OR ISSUES OF CHEQUES OR BY FURNISHING COPY OF BANK ACCOUNT AND IGNORING RATIO 4 DECIDENDI LAID DOWN BY HON'BLE DELHI HIGH COURT ON THE ISSUE IN THE CASES OF CIT V N.R. PORTFOLIO PVT. LTD (2014) 2 ITR-OL-68, CIT V NIPUN BUILDERS AND DEVELOPERS P. LTD (2013) 350 ITR 407, CIT V NAVODAYA CASTLES PVT. LTD (2014) 367 ITR 306? 7. WHETHER IN FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE LD CIT(A) IS JUSTIFIED IN DELETING ADDIT ION OF INCOME OF RS. 20 LAKHS AS ESTIMATED BY THE AO U/S 144 BY TAKING INTO ACCOUNT FACTS AND CIRCUMSTANCED OF THE CASE AND DUE TO NON- PRODUCTION OF THE BOOKS OF ACCOUNTS BY THE ASSESSEE? 8. THAT THE ORDER OF THE CIT(A) IS ERRONEOUS AND I S NOT TENABLE ON FACTS AND IN LAW. 9. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FORGO ANY GROUND(S) OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. 10. THAT THE APPELLANT CRAVES LEAVE TO ADD, ALTER, AMEND OR FORGO ANY GROUND(S) OF APPEAL EITHER BEFORE OR AT THE TIME OF HEARING OF THE APPEAL. 3. THE BRIEF FACTS OF THE CASE ARE THAT THE ASSESSEE FILED THE RETURN OF INCOME ON 01.04.2011 AT RS. NIL AND IT WAS PROCESSED U/S 143(1) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFER RED AS ACT) AND LATER PICKED UP FOR SCRUTINY BY ISSUE OF NOTICE U /S 143(2) OF THE ACT ON 28.09.2011, WHICH WAS CLAIMED BY THE AO TO H AVE BEEN 5 SERVED UPON ASSESSSEE IN PERSON. ON VARIOUS SUBSEQU ENT DATES, NOTICES WERE ISSUED BUT THE ASSESSEE DID NOT COMPLY W ITH. A QUESTIONNAIRE DATED 04.04.2012 WAS THEN ISSUED FOR H EARING ON 24.04.2012, BUT WAS NOT COMPLIED WITH. IN RESPONSE T O THE NOTICE DATED 20.12.2012 SCHEDULING THE HEARING FOR 28.12.20 12, THE AR OF THE ASSESSEE APPEARED AND FILED A LETTER ON 24.12.201 2, WHEREBY THE NEW ADDRESS OF THE ASSESSEE COMPANY AND ITS NEW MA NAGEMENT WAS FILED. IT WAS ALSO INFORMED THAT THE OLD MANAGEM ENT HAD SOLD OF SHARES OF THE COMPANY TO THE NEW MANAGEMENT. SUBSEQUEN TLY, A DETAILED QUESTIONNAIRE WAS ISSUED ALONG WITH A NOTICE U/S 143(2) OF THE ACT ON 26.12.2012, WHICH WAS AGAIN NOT COMPLIED W ITH. UNDER THE CIRCUMSTANCES, THE AO ISSUED A FINAL SHOW CAUSE N OTICE ON 27.02.2013, IN WHICH THE ASSESSEE WAS INFORMED THAT ANY FURTHER NON-COMPLIANCE WILL LEAD TO BEST JUDGEMENT ASSESSMENT. THE AO ALSO HAD INFORMED THAT IN SUCH A CASE, THE SHARE APPLI CATION MONEY OF RS. 2.95 CRORE WOULD BE DEEMED AS INCOME U/S 68 OF THE ACT AND THE BUSINESS INCOME OF THE ASSESSEE WILL BE ASS ESSED AT RS. 20 LAKH. THIS NOTICE WAS RECEIVED BACK ON 04.03.2013 W ITH THE REMARK 'NO SUCH FIRM AT SUCH ADDRESS'. THEREAFTER, THE NOTICE WAS SERVED BY AFFIXTURE BY THE INSPECTOR. HOWEVER, NO FURTHER C OMPLIANCE WAS MADE. UNDER THE CIRCUMSTANCES, THE AO TREATED THE SHAR E APPLICATION MONEY OF RS. 2.95 CRORES RECEIVED DURIN G THE YEAR AS 6 UNEXPLAINED CASH CREDIT U/S 68 OF THE ACT VIDE HIS ORD ER DATED 11.3.2013 PASSED U/S. 144 OF THE INCOME TAX ACT, 1961 . SECONDLY, IN THE ABSENCE OF ANY BOOKS OF ACCOUNT, THE BUSINESS INCOME WAS ESTIMATED AT RS. 20 LAKH AND ACCORDINGLY THE INCOME O F THE ASSESSEE WAS ASSESSED AT RS. 3,15,00,000/-. AGAINST THE ASSE SSMENT ORDER, THE ASSESSEE FILED THE APPEAL BEFORE THE LD. CIT(A) W HO VIDE HIS IMPUGNED ORDER DATED 30.1.2015 HAS PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEVED WITH THE ORDER OF THE LD. C IT(A)-42, NEW DELHI THE REVENUE IS IN APPEAL BEFORE THE TRIBUNAL. 4. LD. CIT(DR) RELIED UPON THE ORDER OF THE AO AND REITERATED THE CONTENTIONS RAISED IN THE GROUNDS OF APPEAL. 5. IN THIS CASE, NOTICE OF HEARING TO THE ASSESSEE W AS SENT BY THE REGISTERED AD POST, IN SPITE OF THE SAME, ASSESSEE, NOR ITS AUTHORIZED REPRESENTATIVE APPEARED TO PROSECUTE THE MATTE R IN DISPUTE, NOR FILED ANY APPLICATION FOR ADJOURNMENT. KEEPING IN VIEW THE FACTS AND CIRCUMSTANCES OF THE PRESENT CASE AND T HE ISSUE INVOLVED IN THE PRESENT APPEAL, WE ARE OF THE VIEW THA T NO USEFUL PURPOSE WOULD BE SERVED TO ISSUE NOTICE AGAIN AND A GAIN TO THE ASSESSEE, THEREFORE, WE ARE DECIDING THE PRESENT AP PEAL EXPARTE QUA ASSESSEE, AFTER HEARING THE LD. DR AND PERUSING THE RECORDS. 6. 7 ADD LD. COUNSEL FOR NOT GRANTING OPPORTUNITY OF CROSS EXAQMINATION BY THE AO AND CIT(A) ALSO ADD ANDOMAN NIKOBAR DECISI ON AND DELETE THE SAME. WE HAVE HEARD THE LD. DR AND PERUSED THE RECORDS, E SPECIALLY THE IMPUGNED ORDER. WITH REGARD TO GROUND NO. 1 & 2 ARE CONCERNED, RELATING TO ADMISSION OF ADDITIONAL EVIDENCE UNDER RU LE 46A OF THE INCOME TAX RULES, 1962 ARE CONCERNED, WE FIND THAT ASSESSEE WAS ASKED TO FILE EVIDENCE IN SUPPORT OF APPOINTMENTS/R EPRESENTATION OF MR. ASHOK KHANDEWAL AS COUNSEL FOR THE ASSESSEE. IT IS NOTED THAT ASSESSEE FILED BEFORE THE LD. CIT(A) A COPY OF THE LETTER D ATED 21.12.2012, WHICH WAS RECEIVED BY THE ITO W. 13(2) ON 24.12.2013. IN THE SAID LETTER, THE SAID COUNSEL HAS MENTIONED THAT THE ASSESSEE COMPAN Y HAD SOLD ITS SHARES TO THE PERSONS MENTIONED IN THE SHARE PURCHA SE AGREEMENT (NEW MANAGEMENT) AND INFORMED THE CURRENT ADDRESS OF THE COMPANY AND OF ITS DIRECTORS. THUS, THE FACT THAT MR. ASHOK KHANDEWAL WAS THE ASSESSEES AUTHORISED REPRESENTATIVE STANDS DULY PROVED. IN VI EW OF THE ABOVE, AS THE SAID COUNSEL FAILED TO REPRESENT BEFORE THE AO IN RESPONSE TO VARIOUS NOTICES, WHICH WERE PROVIDED TO HIM BY THE ASSESSEE SHOWS THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE FROM PRO DUCING THE EVIDENCE, WHICH WAS CALLED UPON TO BE PRODUCED BEFORE THE AO. WE FURTHER FIND THAT THE AO HAS OBJECTED TO ADMIT THE ADDITIONAL EVIDENC E ON THE GROUND THAT ADEQUATE OPPORTUNITIES WERE GIVEN TO THE ASSESSEE D URING THE ASSESSMENT PROCEEDINGS AND, HENCE, THE ASSESSEE CANNOT TAKE PL EA THAT HE WAS 8 PREVENTED BY SUFFICIENT CAUSE FOR FILING THE NECESS ARY EVIDENCE. HOWEVER, IT IS EVIDENT THAT THE AO HAS NOT EXAMINED THE PLE A OF THE ASSESSEE THAT THE NON-COMPLIANCE OF THE ASSESSEE WAS DUE TO PROFE SSIONAL NEGLIGENCE ON THE PART OF ITS COUNSEL AS ALLEGED BY ITS DIRECTOR IN THE AFFIDAVIT AFFIRMED, WHICH WAS ENCLOSED ALONG WITH ADDITIONAL EVIDENCE. KEEPING IN VIEW THE ABOVE, AS THE SAID COUNSEL FAILED TO PROVIDE THE CO RRECT NEW ADDRESS OF THE COMPANY SUBSEQUENT UPON ITS ACQUISITION BY THE NEW MANAGEMENT AS A RESULT OF SHARE PURCHASE AGREEMENT, A COPY OF WHICH WAS PLACED BEFORE THE AO, EVIDENTLY, THE ASSESSEE COULD NOT HAVE COMP LIED WITH THE NOTICES ISSUED AT THE OLD ADDRESS. THIS IS MORE SO RELEVANT AS AT NO STAGE THE NEW MANAGEMENT WOULD HAVE COME TO KNOW ABOUT THE ISSUAN CE OF NOTICE U/S 143(2) OF THE ACT FIXING THE HEARING, WHICH WAS DIS PATCHED AT THE OLD ADDRESS AS PER RECORD. IT IS EVIDENT THAT THE FIRST NOTICE AT THE GIVEN ADDRESS WAS DISPATCHED ON 20.12.2012, WHICH WAS HAN DED OVER TO THE COUNSEL OF THE APPELLANT COMPANY, WHO WAS LOOKING A FTER THE ASSESSEES CASE IN EARLIER YEARS ASSUMING THAT HE WAS WELL VER SED WITH THE MATTERS. THE SAID COUNSEL THEREAFTER DID NOT APPEAR BEFORE T HE AO, NOR INFORMED THE ASSESSEE ABOUT DEVELOPMENTS IN ASSESSMENT PROCE EDINGS. THEREFORE, THE DIRECTORS OF THE COMPANY WERE PREVENTED BY SUFF ICIENT CAUSE FROM PRODUCING THE EVIDENCE. UNDER THE CIRCUMSTANCES, LD . CIT(A) HAS RIGHTLY HELD THAT IT IS A FIT CASE TO ADMIT ADDITIONAL EVID ENCE UNDER RULE 46A(L)(B) & (C) OF THE I.T. RULES, 1962. IT IS NOTED THAT A O HAS CHALLENGED SUCH ADMISSION IN THE CIRCUMSTANCES MENTIONED IN CLAUSE( D), HOWEVER, THE ASSESSEE HAS NOT MADE THE REQUEST UNDER CLAUSE(D). THEREFORE, THE 9 OBJECTIONS OF THE AO IN THIS REGARD ARE MISPLACED AND ARE OVER-RULED. ACCORDINGLY, THE ADDITIONAL EVIDENCES WERE RIGHTLY ADMITTED BY THE LD. CIT(A), WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, THER EFORE, WE UPHOLD THE ACTION OF THE LD. CIT(A) ON THE ISSUES IN DISPUTE AND REJECT THE GROUNDS RAISED BY THE REVENUE. 6.1 WITH REGARD TO GROUND NO. 3, 4, 5 & 6 RELATING TO DELETION OF ADDITION OF RS.2.81 CRORES ON ACCOUNT OF UNEXPLAINE D SHARE APPLICATION MONEY ARE CONCERNED, WE FIND THAT AO HAS EXAMINED THE ADDITIONAL EVIDENCES DURING THE REMAND PROCEEDINGS AND, HENCE, VERIFIED THAT THE ASSESSEE HAD FILED A COPY OF ITR, AUDIT RE PORT, BANK STATEMENT, SHARE APPLICATION, BOARD'S RESOLUTION, STAMP DUTY A S PER ROC RECORD AND AFFIDAVIT AFFIRMED BY THE DIRECTORS OF THE 15 INVES TOR COMPANIES, WHO HAD INVESTED AN AGGREGATE AMOUNT OF RS. 2,95,25,000/- A S SHARE APPLICATION MONEY IN THE ASSESSEE COMPANY. THE AO ISSUED NOTICE U/S 133(6), IN WHICH ALL THE SHARE APPLICANTS HAVE CONFIRMED HAVIN G BEEN GIVEN THE CHEQUES TO THE APPELLANT AND HAVE FURTHER SUBMITTED A COPY OF ITR, BALANCE SHEET AND THE BANK STATEMENT. THE AO ALSO D EPUTED AN INSPECTOR FOR FIELD ENQUIRY, WHO HAS VERIFIED THE DOCUMENTS I N SUPPORT OF IDENTITY, GENUINENESS AND CREDITWORTHINESS. THE AO HAS ALSO V ERIFIED THAT THE SAID SHARE APPLICANTS HAVE DULY RECORDED SUCH INVESTMENT S IN THEIR BALANCE SHEET ALSO. THUS, THE AO HAS CONFIRMED THAT OTHER T HAN 3 PERSONS, NAMELY, M/S RAVI SALES CORPORATION, SHYAM LAI AND M /S HIND PHARMA, IN ALL OTHER CASES, THERE WAS NO CASH DEPOSIT IN THE B ANK ACCOUNT PRIOR TO 10 ISSUING THE CHEQUE AS SHARE APPLICATION WITH THE AS SESSEE COMPANY. IT IS ALSO NOTED THAT IN CASE OF THE ABOVE-REFERRED 3 SH ARE APPLICANTS, NAMELY, M/S RAVI SALES CORPORATION, SHYAM LAI AND M/S HIND PHARMA, THERE WERE CASH DEPOSITS JUST BEFORE ISSUE OF CHEQUES TO THE A PPELLANT COMPANY. NO SATISFACTORY EXPLANATION WITH REGARD SOURCE OF SUCH CASH DEPOSIT WAS GIVEN BEFORE THE AO NOR BEFORE ME. THE AO HAD ISSUE D SUMMONS TO THESE 3 PARTIES IN THE REMAND PROCEEDINGS, WHO FAILED TO COMPLY BEFORE THE AO. THE ASSESSEE COULD NOT PRODUCE THESE PARTIES NOR CO ULD FURNISH ANY COGENT REASON FOR THEIR NON-APPEARANCE. UNDER THE C IRCUMSTANCES, GENUINENESS OF CASH CREDITS IN RESPECT OF THESE THR EE PARTIES REMAINS UNEXPLAINED. IN VIEW OF THIS, CASH CREDITS AGGREGAT ING TO RS. 14 LAKH RECEIVED FROM THESE 3 PARTIES ARE HELD AS UNEXPLAIN ED CASH CREDIT U/S 68. HOWEVER, AS IN RESPECT OF OTHER 12 PARTIES, THERE I S NO ADVERSE EVIDENCE ON RECORD TO SUSPECT THEIR IDENTITY, GENUINENESS OR CREDITWORTHINESS, AND THE AO HAS VERIFIED THE AUTHENTICITY OF SUPPORTING DOCUMENTS FILED BY THE APPELLANT IN THIS REGARD, THE BALANCE SHARE APPLICA TION MONEY RECEIVED FROM SUCH PARTIES IS HELD AS EXPLAINED. ACCORDINGLY , THE ASSESSEE GOT PART- RELIEF BY THE LD. CIT(A), WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, THEREFORE, WE UPHOLD THE ACTION OF THE LD. CIT(A ) ON THE ISSUE IN DISPUTE AND REJECT THE GROUNDS RAISED BY THE REVENU E. 6.2 APROPOS GROUND NO. 7 IS CONCERNED, RELATING TO DELETION OF ADDITION OF RS. 20 LACS, WE FIND THAT AO WAS COMPELLED TO MAKE SOME KIND OF ESTIMATION WITH REGARD ADDITION TO INCOME I N THE ABSENCE OF ANY 11 COMPLIANCE MADE BY THE ASSESSE BEFORE THE AO DURING THE ASSESSMENT PROCEEDINGS. AS DISCUSSED ABOVE, WE HAVE UPHELD THE ACTION OF THE LD. CIT(A) FOR ALLOWING THE ADMISSION OF ADDITIONAL EVI DENCES ON THE GROUNDS THAT THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUSE TO PRODUCE EVIDENCES CALLED FOR BY THE AO DURING THE ASSESSMENT PROCEED ING ON ACCOUNT OF PROFESSIONAL NEGLIGENCE BY ITS AR, MR. ASHOK KHANDE WAL, CA, WHO WAS HANDLING THE TAX MATTERS OF APPELLANT PRIOR TO ITS TAKE-OVER BY THE NEW MANAGEMENT. IT IS ALSO SEEN THAT THE AO HAD, VIDE N OTICE DATED 08.03.2013, REQUIRED THE ASSESSEE TO PRODUCE BOOKS OF ACCOUNT. THE APPELLANT HAS PLEADED THAT EVEN THOUGH THE BOOKS OF ACCOUNTS WERE NOT PRODUCED BEFORE THE AO DUE TO THE ABOVE MENTIONED R EASON, YET THE AUDITED FINANCIAL ACCOUNTS WERE ENCLOSED WITH THE RETURN OF INCOME AND ARE AVAILABLE ON THE ASSESSMENT RECORD. IT WAS SUBM ITTED THAT THE ASSESSEE WAS CARRYING OUT NO BUSINESS DURING THE CU RRENT YEAR AND ALSO IN THE IMMEDIATELY PRECEDING YEAR AND ITS RETURN FOR T HE IMMEDIATELY PRECEDING YEAR WAS ACCEPTED BY THE AO AS SUCH. SINC E THE AO HAS NOT BROUGHT OUT ANY EVIDENCE ON RECORD TO SUGGEST THAT THE ASSESSEE WAS CARRYING OUT ANY BUSINESS ACTIVITY DURING THE YEAR FROM WHOM, IT HAD EARNED INCOME AND HAS NOT RAISED ANY QUERY ON THE A UDITED FINANCIAL ACCOUNTS FILED BY THE APPELLANT ALONG WITH THE RETU RN OF INCOME, THE ACTION OF THE AO OF ESTIMATING THE INCOME IS HELD TO BE BA SELESS AND ARBITRARY WITHOUT SUPPORT OF ANY EVIDENCE GATHERED IN THIS RE GARD OR BASED ON ANY MATERIAL AVAILABLE ON RECORD. IN THE ONE-LINE ORDER ON THIS ISSUE, THE AO HAS NOT DISCUSSED THE BASIS FOR ESTIMATING THE BUSI NESS INCOME OF RS. 20 12 LAKH. THEREFORE, SUCH ADDITION WAS RIGHTLY DELETED BY THE LD. CIT(A), WHICH DOES NOT NEED ANY INTERFERENCE ON OUR PART, TH EREFORE, WE UPHOLD THE ACTION OF THE LD. CIT(A) ON THE ISSUE IN D ISPUTE AND REJECT THE GROUND RAISED BY THE REVENUE. 6.3 GROUND NO. 8, 9, & 10 ARE GENERAL IN NATURE, HEN CE, NEED NOT BE ADJUDICATED. 7. IN THE RESULT, THE REVENUES APPEAL STANDS DISMI SSED ORDER PRONOUNCED ON 05/02/2019. SD/- SD/- [PRASHANT MAHARISHI] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 05/02/2019 SRBHATNAGAR COPY FORWARDED TO: - 1. ASSESSEE - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENC HES