DCIT, New Delhi V. M/s. Ultra Home Construction Pvt. Ltd., Noida

ITA 1877/DEL/2014

• Counselvise Citation: [2018] 126 COUNSELVISE.COM (IT) 3495 (ITAT-DELHI)
• Duration Of Justice: 3 year(s) 10 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 13-02-2018
• Appeal Filed By: Department
• Order Result: Partly Allowed
• Bench Allotted: D
• Next Hearing Date: 03-05-2017
• Assessment Year: 2011-2012
• Appeal Filed On: 31-03-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: APARNA KARAN
• Keywords: Bogus purchase; Unexplained cash credit; Income from undisclosed sources; Search and seizure; Opportunity of being heard; Additional evidence; Question of law; Onus to prove
• Section: 143(3); 153A; 131; 68; 69; 148; 132; 11; 15; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH : A , NEW DELHI BEFORE SH. AMIT SHUKLA , JUDICIAL M EMBER AND SH. O.P. KANT , ACCOUNTANT MEMBER ITA NO S . 417 & 1877 / DE L/ 2014 ASSESSMENT YEAR S : 2010 - 11 & 2011 - 12 DCIT, CENTRAL CIRCLE - 7, NEW DELHI VS. M/S. ULTRA HOME CONSTRUCTION PVT. LTD., C - 56/40, SECTOR - 62, NOIDA PAN : AAACU6772G ( APPELLANT ) (RESPONDENT) AND C.O. NO.239/DEL/2014 [IN ITA NO. 417/ DEL/ 2014] ASSESSMENT YEAR: 2010 - 11 M/S. ULTRA HOME CONSTRUCTION PVT. LTD., C - 56/40, SECTOR - 62, NOIDA VS. DCIT, CENTRAL CIRCLE - 7, NEW DELHI PAN : AAACU6772G (APPELLANT) (RESPONDENT) AND ITA NO. 4841/ DEL/ 2014 ASSESSMENT YEAR: 2011 - 12 DCIT, CENTRAL CIRCLE - 7, NEW DELHI VS. M/S. AMARPALI PRINCELY ESTATE PVT. LTD., C - 56/40, SECTOR - 62, NOIDA PAN : AAICA2631A (APPELLANT) (RESPONDENT) AND C.O. NO. 152/DEL/2015 [IN ITA NO. 4841/ DEL/ 2014] ASSESSMENT YEAR: 2011 - 12 DCIT, CENTRAL CIRCLE - 7, NEW DELHI VS. M/S. AMARPALI PRINCELY ESTATE PVT. LTD., C - 56/40, SECTOR - 62, NOIDA PAN : AAICA2631A (APPELLANT) (RESPONDENT) 2 DEPARTMENT BY SMT. APARNA KARAN, CIT(DR) ASSESSEE BY NONE PRESENT DATE OF HEARING 30.01.2018 DATE OF PRONOUNCEMENT 1 3 . 0 2 . 2 0 1 8 ORDER PER BENCH : THESE APPEALS PREFERRED BY THE R EVENUE AND CROSS OBJECTIONS OF THE ASSESSEE S IN TWO CASE S ARE DIRECTED AGAINST SEPARATE ORDERS PAS SED BY THE LD. COMMISSIONER OF INCOME - T AX (A PPEALS) - I, NEW DELHI [ IN SHORT THE LD. CIT - (A) ] FOR ASSESSMENT YEAR S 2010 - 11 AND 20 11 - 12. AS CERTAIN ISSU ES ARE COMMON IN THE APPEALS BY THE R EVENUE AND CROSS O BJECTION S OF THE ASSESSEE, SAME WERE HEARD TOGETHER AND DISPOSED OF BY WAY OF THIS CONSOLIDATED ORDER FOR CONVENIENCE. 2. AT THE OUTSET, WE MAY LIKE TO MENTION THAT WHEN THESE APP EALS AND CROSS OBJECTIONS WERE CALLED FOR HEARING, NEITHER THE ASSESSEE(S) OR THEIR AUTHORIZED REPRESENTATIVE APPEARED NOR ANY APPLICATION FOR ADJOURNMENT WAS FILED BEFORE THE BENCH. ON PERUSAL OF THE RECORD IN THE CASE O F M/S AM RA PALI PRINCELY ESTATE PRIV ATE L IMITED IN ITA NO. 4841/DEL/2014 AND C . O . NO. 152/DEL/2015, WE FIND THAT IN PAST ON MANY OCCASIONS, THE APPEAL AND CROSS OBJECTION HAVE BEEN ADJOURNED EITHER ON THE REQUEST OF THE ASSESSEE OR DUE TO ABSENCE OF THE ASSESSEE. ON 07/09/2017, NOBODY WAS P RESENT ON BEHALF OF THE ASSESSEE AND , THUS , CASE WAS ADJOURNED TO 21/11/2017. AGAIN ON 21/11/2017, ON THE REQUEST OF THE ASSESSEE CASE WAS ADJOURNED TO 22/11/2017. SIMILARLY , IN THE CASE OF THE ANOTHER ASSESSEE M/S ULTRA HOME CONSTRUCTION P RI VATE L IMITED , ALSO THE CASE WAS ADJOURNED ON MANY OCCASIONS , ON THE REQUEST OF THE 3 ASSESSEE S COUNSEL. ON 22/11/201 7 , ON THE REQUEST OF THE ASSESSEE , THE APPEALS AND CROSS OBJECTION WERE CLUBBED ALONGWITH APPEAL AND CROSS OBJECTION IN THE CASE OF M/S AMRAPALI PR I NCELY ESTATE P VT. L TD . AND C ASE S WERE ADJOURNED TO 27/11/2017 . AGAIN ON NEXT DATE OF HEARING I.E. 27/11/2017, NONE WAS PRESENT ON BEHALF OF THE ASSESSEE(S) AND THUS THE FRESH NOTICE WAS ISSUED TO THE ASSESSEE(S) FIXING THE APPEAL ON 30/01/2018. THIS NOTICE WAS D ULY SENT BY THE REGISTERED POST AT THE ADDRESS PROVIDED IN FORM NO. 36A OF THE CROSS OBJECTION FILED BY M/S AMR A PALI PRINCELY ESTATE P VT. LTD. THIS NOTICE HAS NOT RETURNED UNSERVED AND , THEREFORE , IT IS DEEMED TO HAVE BEEN SERVED. THEREFORE , THESE APPEALS AS WELL AS CROSS OBJECTIONS ARE PENDING FOR ADJUDICATION SINCE LONG FOR WANT OF PROSECUTION. IN VIEW OF THE ABOVE, WE ARE OF CONSIDERED VIEW THAT FURTHER ADJOURNMENT OF THESE APPEALS AND CROSS OBJECTION S WOULD NOT BE JUST AND PROPER AND, THUS, HEARD EX - PA RTE QUA THE ASSESSEE. 3. THE G ROUNDS RAISED IN C.O. NO. 239/DEL/2014 IN THE CASE OF M/S. ULTRA HOME CONSTRUCTION PVT. LTD. FOR ASSESSMENT YEAR 2010 - 11 , ARE REPRODUCED AS UNDER: 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE NOTICE U/S 153A ISSUED IN THIS CASE IS ILLEGAL & WITHOUT JURISDICTION AND ACCORDINGLY, THE ASSESSMENT ORDER PASSED ON THE FOUNDATION OF SUCH NOTICE IS NOT SUSTAINABLE AND IS LIABLE TO BE QUASHED. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE COMMISSIONER OF INCOME TAX (APPEALS) SHOULD HAVE HELD THAT THE ASSESSMENT ORDER PASSED BY THE ASSESSING OFFICER IS BAD - IN - LAW AND VOID. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE INITIATION OF ASSESSMENT PROCEEDINGS AND ISSUE / SERVICE OF NOTICES BY THE ASSESSING OFFICER IS NOT IN ACCORDANCE WITH THE PROVISIONS OF LAW AND ACCORDINGLY THE ASSESSMENT ORDER PASSED IS LIABLE TO BE QUASHED. 4 THE RESPONDENT CRAVES LEAVE TO ADD, ALTER, MODIFY OR DELETE ONE OR MORE GROUND BEFORE OR AT THE TIME OF HEARING O F APPEAL. THE AFORESAID GROUNDS ARE WITHOUT PREJUDICE TO EACH OTHER. 3.1 THE G ROUNDS RAISED IN C . O. NO. 152/DEL/2015 IN THE CASE OF AMRAPALI PRINCELY ESTATE PRIVATE L IMITED FOR ASSESSMENT YEAR 2011 - 12 , ARE REPRODUCED AS UNDER : 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE INITIATION OF ASSESSMENT PROCEEDINGS AND ISSUE/SERVICE OF NOTICES BY THE ASSESSING OFFICER IS NOT IN ACCORDANCE WITH THE PROVISIONS OF LAW AND ACCORDINGLY THE ASSESSMENT ORDER PASSED IS LIABLE TO BE QUASHED. 2. THE RESPONDENT CRAVES LEAVE TO ADD, ALTER, MODIFY OR DELETE ONE OR MORE GROUND BEFORE OR AT THE TIME OF HEARING OF APPEAL. 3.2 IN THESE CASE S OF CROSS OBJECTIONS , NOTICE WAS SENT TO THE ASSESSEE BY REGD. AD POST FOR HEARING ON 30.01.2018 BUT NEITHER THE ASSESSEE NOR ITS AUTHORIZED REPRE SENTATIVE ATTENDED THE HEARING. IT IS, THUS, INFERRED THAT THE ASSESSEE IS NOT INTERESTED IN PROSECUTION OF THE APPEAL. 3.3 CONSIDERING THE FACTS OF THE CASE AND KEEPING IN VIEW THE PROVISIONS OF RULE 19(2 ) OF THE INCOME - TAX (APPELLATE TRIBUNAL) RULES, 1963 AS WERE CONSIDERED IN THE CASE OF CIT VS. MULTIPLAN INDIA LTD., (38 ITD 320)(DEL), THE ASSESSEE S CROSS OBJECTINS ARE LIABLE TO BE DISMISSED FOR WANT OF PROSECUTION. 3.4 THE HON'BLE MADHYA PRADESH HIGH COURT IN THE CASE OF ESTATE OF LATE TUKOJIRAO HOLKAR VS. CWT (223 ITR 480) HAS HELD AS UNDER: 'IF THE PARTY, AT WHOSE INSTANCE THE REFERENCE IS MADE, FAILS 'TO APPEAR AT THE HEARING, OR FAILS IN TAKING STEPS FOR PREPARATION OF 5 THE PAPER BOOKS SO AS TO E NABLE HEARING OF THE REFERENCE, THE COURT IS NOT BOUND TO ANSWER THE REFERENCE. ' 3.5 SIMILARLY, HON'BLE PUNJAB & HARYANA HIGH COURT IN THE CASE OF NEW DIWAN OIL MILLS VS. CIT (2008) 296 ITR 495) RETURNED THE REFERENCE UNANSWERED SINCE THE ASSESSEE REMAINED ABSENT AND THERE WAS NOT ANY ASSISTANCE FROM THE ASSESSEE. 3.6 THEIR LORDSHIPS OF HON'BLE SUPREME COURT IN THE CASE OF CIT VS. B. BHATTACHARGEE & ANOTHE R (118 ITR 461 AT PAGE 477 - 478) HELD THAT THE APPEAL DOES NOT MEAN, MERE FILING OF THE MEMO OF APPEAL BUT EFFECTIVELY PURSUING THE SAME. 3.7 . IN VIEW OF ABOVE , BOTH THE CROSS OBJECTIONS ARE DISMISSED FOR NON - PROSECUTION . 4. AS FAR AS APPEALS OF THE R EV ENUE ARE CONCERNED, WE ARE OF THE OPINION THAT THESE APPEALS MAY BE DISPOSED OFF ON THE BASIS OF THE RECORD AFTER HEARIN G THE LD. DEPARTMENTAL R EPRESENTAT IVE APPEARING ON BEHALF OF THE R EVENUE. WE , THEREFORE, PROCEEDED TO HEAR AND ADJUDICATE THESE APPEALS EX PARTY QUA THE ASSESSEE. ITA NO.417/DEL/2014 FOR AY: 2010 - 11 5. FIRST, WE TAKE UP THE APPEAL HAVING ITA NO. 417/DEL/2014 IN THE CASE OF M/S. ULTRA H OME C ONSTRUCTION PRIVATE L IMITED FOR ASSESSMENT YEAR 2010 - 11 FOR ADJUDICATION. THE GROUNDS OF APPEAL ARE REPRODUCED AS UNDER: 1. THE ORDER OF THE LD. CIT(APPEALS) IS NOT CORRECT IN LAW AND FACTS. 2. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.5,08,25,724/ - MADE BY AO ON ACCOUNT OF BOGUS P URCHASES OF RAW MATERIAL. 6 3. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASES, THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.4,50,50,000/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF UNDISCLOSED SALES U/S 69 OF THE INCOME TAX ACT, 1961. 4. ON THE FACTS AND THE CIRCUMSTANCES OF THE CASES, THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.15,93,836/ - MADE BY THE AO ON ACCOUNT OF SCRAP SALES CREDITED IN THE SALES SIDE AS SALES HAS BEEN CRYSTALLIZED INSTEAD OF SETTING IT IN THE PURC HASE ACCOUNT. 5. THE APPELLANT CRAVES LEAVE TO ADD, AMEND ANY/ALL OF THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF THE HEARING OF THE APPEAL. 6. B RIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY WAS ENGAGED IN THE BUSINESS OF BUILDING, CONSTRUCTION AND DEVELOPMENT OF RESIDENTIAL & COMMERCIAL PROJECTS. A SEARCH AND SEIZURE OPERATION UNDER SECTION 132 OF TH E INCOME - TAX ACT, 1961 (IN SHORT THE ACT ) WAS CARRIED OUT ON 09/09/2010 IN M/S AMRAPALI G ROUP OF CASES, INCLUDING PREMISES OF THE ASSESSEE. THE ASSESSEE FILED ITS REGULAR RETURN OF INCOME UNDER SECTION 139 OF THE ACT ON 28/12/2010 , DECLARING INCOME OF RS.35,06,23,450/ - . CONSEQUENT TO T HE SEARCH ACTION, IN RESPONSE TO THE NOTICE UNDER SECTION 153A OF THE ACT ISSUED BY THE ASSESSING OFFICER, THE ASSESSEE FILED RETURN OF INCOME ON 26/03/2012 , DECLARING TOTAL INCOME OF RS.35,06,23,450/ - I.E. SAME AS FILED IN ORIGINAL RETURN OF INCOME. THE S TATUTORY NOTICES WERE ISSUED BY THE ASSESSING OFFICER AND ASSESSMENT PROCEEDINGS UNDER SECTI ON 143(3) READ WITH SECTION 15 3A OF THE ACT WERE COMPLETED ON 31/03/2013 AFTER MAKING CERTAIN ADDITIONS TO THE RETURNED INCOME. AGGRIEVED WITH THE ADDITIONS MADE, T HE ASSESSEE FILED APPEAL BEFORE THE LD. CIT - ( A ) , WHO PARTLY ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEVED, THE R EVENUE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE GROUNDS AS REPRODUCED ABOVE. 7 7. THE GROUND NO. 1 ( WRONGLY NUMBERED AS 8) IS GENERAL IN NATUR E AND IT IS COVERED BY OTHER GROUNDS OF THE APPEAL AND , THEREFORE , WE ARE NOT ADJUDICATING UPON SPECIFICALLY . 8. THE GROUND NO. 2 (WRONGLY NUMBERED AS 9 ) RELATES TO ADDITION OF RS. 5,08,25,724/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BOGUS PURCHASES O F RAW MATERIAL. 8.1 THE FACTS QUA THE ADDITION ARE THAT IN THE SEARCH ACTION LEDGER ACCOUNTS OF THE PARTIES FROM WHOM THE ASSESSEE MADE PURCHASES OF RAW MATERIAL/BUILDING CONSTRUCTION MATERIAL LIKE CEMENT, IRON AND STEEL ETC . WORTH RS. 44,87,02,688 / - WERE FOUND , WHICH ARE INVENTARISED AS PAGES NO. 77 TO 105 OF ANNEXURE A - 1 AT PREMISES SEARCHED BY PARTY AB - 1. IN THE STATEMENT RECORDED UNDER SECTION 132(4) OF THE ACT, SH. ANIL SHARMA, DIRECTOR OF THE ASSESSEE COMPANY WAS ASKED TO FURNISH CORROBORATING E VIDENCES LIKE BILLS OF TRANSPORT, TOLL NAKA ENTRIES, DETAILS OF DESTINATION AND UTILIZATION THEREOF, HOWEVER , HE COULD NOT FURNISH THE SAID DETAIL AN D SURRENDERED THE AMOUNT OF RS. 44,87,02,688/ - AS UNACCOUNTED INCOME OF THE ASSESSEE COMPANY ON ACCOUNT OF B OGUS EXPENSES CLAIMED. 8.2 THE DEPARTMENT FURTHER CARRIED OUT ENQUIRIES AND ISSUED SUMMONS UNDER SECTION 131 OF THE ACT TO ALL THOSE SUPPLIERS OF THE RAW MATERIALS, HOWEVER , THE SUMMONS WERE RETURNED UNSERVED WITH THE REMARKS AS NO SUCH ADDRESSES . THE D EPARTMENT FURTHER DEPUTED AN INSPECTOR TO FIND OUT THE BUSINESS PREMISES OF THE SUPPLIERS, HOWEVER , HE ALSO REPORTED THAT THOSE ADDRESS ES DID NOT EXIST . IN VIEW OF THE ABOVE FACTS, DURING ASSESSMENT PROCEEDING, THE ASSESSING OFFICER ASKED THE ASSESSEE TO SUBSTANTIATE THE PURCHASES IN DISPUTE AND PRODUCE THE PARTIES TO PROVE THE EXISTENCE AND GENUINENESS OF THE TRANSACTIONS. THOUGH THE ASSESSEE PRODUCED DOCUMENTS LIKE COPY OF ACCOUNT, PURCHASE BILLS, FREIGHT BILLS AND 8 THE DHARMA KATTA BILLS IN CASE OF FOLLO WING SUPPLIERS BUT FAILED TO PRODUCE THE PARTIES BEFORE THE ASSESSING OFFICER: I) M/S. BAJRANG TRADING CO. RS.1,02,25,724/ - II) M/S. BALAJI ENTERPRISES RS.2,00,00,000/ - III) M/S. S. C . TRADING CO. RS.2,06,00,000/ - 8.3 THE ASSESSING OFFICER AGAIN ISSUED SUMMONS TO THOSE PARTIES ON TWO OCCASIONS , H OWEVER , THOSE SUMMONS RETURNED UNSERVED WITH THE REMARK THAT NO SUCH PARTIES EXISTED ON GIVEN ADDRESSES. THE ASSESSEE WAS AGAIN GIVEN OPPORTUNITY BY THE ASSESSING OFFICER TO PRODUCE THOSE PARTIES ON 15/03/ 2013 AND ON 20/03/2013 , HOWEVER , IN VIEW OF THE NON - COMPLIANCE BY THE ASSESSEE, THE ASSESSING OFFICER HELD THE PURCHASES AS UNEXPLAINED WITH FOLLOWING FINDING: 7.6 IN VIEW OF THE ABOVE FACTS, THE IDENTITY & EXISTENCE OF M/S. BAJRANG TRADING CO., M/S. BALAJI ENTERPRISES & M/S. S.C. TRADING CO. AND GENUINENESS OF TRANSACTIONS OF PURCHASES OF RAW MATERIAL BY THE ASSESSEE REMAINED UN - VERIFIABLE, AS: A) THE EXISTENCE OF THE PARTIES ON THE GIVEN BUSINESS AS WELL AS RESIDENTIAL ADDRESSES WERE NOT VERIFIABLE . B) THE LOCATION OF THE PREMISES FROM WHICH BUSINESS IS PURPORT TO BE CARRIED IS SUCH FROM WHICH OPERATION OF BUSINESS ALLEGED TO BE CARRIED OUT IS NOT POSSIBLE. C) THE LEVEL OF TRANSACTIONS ROUTED THROUGH THE BANK ACCOUNT OF THESE PARTIES ARE SUCH VO LUMINOUS AND BIG, WHICH PERSON OF STATUS OF THESE PARTIES IN NO MANNER CAN MATCH. D) MONEY ROUTED THROUGH THE BANK ACCOUNTS ARE AT FIRST STAGE TRANSFERRED TO OTHER ACCOUNTS AND AT SECOND STAGE THESE ARE WITHDRAWN MOSTLY IN CASH, WHICH IS REPATRIATED TO T HE BENEFICIARY I.E. THE ASSESSEE COMPANY AND ITS ASSOCIATES IN CASH. E) MOREOVER, FAILURE ON THE PART OF THE ASSESSEE TO PRODUCE SUCH PARTIES INSPITE OF THE REPEATED OPPORTUNITY GIVEN TO THEM CONCLUSIVELY PROVE THAT NO SUCH PARTY ACTUAL EXIST WHICH CAN S TAND AND OWN - UP THE 9 TRANSACTIONS ALLEGED TO BE ROUTED THROUGH THEIR BANK ACCOUNTS AND ISSUE OF PURCHASE BILLS. 8.4 THE LD. CIT - ( A ), HOWEVER , DELETED THE ADDITION. THE RELEVANT FINDING OF THE LD. CIT - ( A ) ARE REPRODUCED AS UNDER: 6.2 THE FACTS ARE THAT THE APPELLANT PURCHASED CERTAIN CONSTRUCTION MATERIALS (STEEL, HARDWARE, ETC.) FROM THESE 3 PARTIES. THE PURCHASE ORDERS, BIILS. PAYMENT DETAILS AND OTHER SUPPORTING DOCUMENTS RELATING TO THESE PURCHASES WERE PRODUCED BEFORE THE AO. THE PAYMENTS FOR THE PURCHASES WERE MADE BY THE APPELLANT FROM ITS BANK ACCOUNTS WITH BANK OF BARODA (A/C NO.21580200000057) AND HDFC BANK (A/C NO.01938630000187) AND WERE DULY CREDITED TO THE RESPECTIVE BANK ACCOUNTS OF THESE PARTIES (VIJAYA BANK, DELHI A/C O F BAJRANG TRADING CO., TAMILNADU MERCANTILE BANK, GHAZIABAD A/C OF BALAJI ENTERPRISES AND VIJAYA BANK, DELHI A/C OF S.C. TRADING CO.). THE ONLY REASON FOR THE REVENUE TO TREAT THESE TRANSACTIONS AS BOGUS IS THAT THE SAID PARTIES WERE NOT FOUND AT THE SAID PREMISES. THE REVENUE HAS ALSO LINKED THESE TRANSACTIONS WITH AN ADMISSION MADE BY SH. ANIL SHARMA, THE MANAGING DIRECTOR AND MAIN PERSON OF THE AMRAPALI GROUP, DURING THE COURSE OF SEARCH THAT THE GROUP HAD ENGAGED IN UNSUBSTANTIATED PURCHASES AND HIS OFF ER TO TAX OF UNDISCLOSED INCOME AMOUNTING TO RS.44,87,02,688/ - ON THIS COUNT. 6.3 I HAVE CAREFULLY CONSIDERED THE CASE MADE OUT BY THE REVENUE IN THE ASSESSMENT ORDER VIS - A - VIS THE SUBMISSIONS OF THE APPELLANT AND THE DOCUMENTS PRODUCED BEFORE ME (ALSO PR ODUCED BEFORE THE AO). ADMITTEDLY, ALL THE DOCUMENTS REQUIRED TO ESTABLISH THE PURCHASES WERE PRODUCED BY THE APPELLANT BEFORE THE AO. HOWEVER, ON FAILURE OF THE APPELLANT TO PRODUCE THE SAID PARTIES, THE REVENUE ISSUED SUMMONS TWICE TO THE SAID PARTIES TO ENFORCE ATTENDANCE, BUT THE SUMMONS WERE RETURNED BY POSTMAN WITH REMARKS SUCH AS ADDRESSEE MOVED / LEFT WITHOUT ADDRESS OR INCOMPLETE ADDRESS OR SIMPLY MENTIONING THE DATE OF VISIT. INSPECTOR DEPUTED FOR VERIFYING THE PARTIES REPORTED THAT THEY WERE NOT FOUND AT THE GIVEN ADDRESSES. THE APPELLANT WAS, THEREAFTER, AGAIN REQUIRED TO PHYSICALLY PRODUCE 10 THE PARTY FOR VERIFICATION AND UPON FAILURE TO DO SO THE REVENUE TREATED THE TRANSACTIONS AS BOGUS. HOWEVER, THE MOOT QUESTION HERE IS WHETHER IT WAS IN O RDER FOR THE REVENUE TO SUBSEQUENTLY REQUIRE THE APPELLANT TO PRODUCE THE PARTY FOR PHYSICAL VERIFICATION? THE REVENUE JUSTIFIES THE ADVERSE VIEW IT HAS TAKEN FOR THE REASON THAT THE PARTY HAD NOT BEEN FOUND AT THE GIVEN ADDRESS. THE APPELLANT S CLAIM ON T HE OTHER HAND IS THAT IT IS NOT THE CASE THAT THE PARTY WAS NOT IN EXISTENCE BUT RATHER THE PARTY HAD LEFT THE PREMISES AS EVIDENCED BY THE NOTING OF THE DEPARTMENT OF POSTS ON THE RETURNED SUMMONS. FIRSTLY, PRODUCTION OF THE DOCUMENTS EVIDENCING THE TRANS ACTIONS WAS IN ITSELF SUFFICIENT TO DISCHARGE THE PRIMARY ONUS ON THE APPELLANT, AND THERE WAS NO OBLIGATION ON THE APPELLANT TO PHYSICALLY PRODUCE THE PARTY BEFORE THE AO UNLESS SOME DEFECT HAD BEEN FOUND IN THE DOCUMENTARY EVIDENCE SO PRODUCED. THOUGH TE CHNICAL RULES OF EVIDENCE ARE NOT STRICTLY APPLICABLE TO TAX PROCEEDINGS (DHAKESWARI COTTON MILLS LTD. V. CIT [1954] 26 ITR 775 & DHAKESWARI COTTON MILLS LTD. V. CIT [1955] 2/7 ITR 126 (SC)}, TAXING AUTHORITIES ARE NOT REQUIRED TO PUT ON BLINKERS WHILE LOO KING AT THE DOCUMENTS PRODUCED BEFORE THEM AND THEY ARE TO LOOK INTO THE SURROUNDING CIRCUMSTANCES TO FIND OUT THE REALITY OF THE RECITALS MADE IN THOSE DOCUMENTS {CIT V. DURGA PRASAD MORE [1971 ] 82 ITR 540 (SC)}. THEREFORE, IN THE PRESENT CASE IT WAS NOT APPROPRIATE TO REQUIRE THE APPELLANT TO PRODUCE THE PARTY FOR PHYSICAL VERIFICATION WITHOUT FINDING ANY DEFECT IN THE DOCUMENTARY EVIDENCE PRODUCED. FROM THE DOCUMENTS PRODUCED, IT IS SEEN THAT THE SELLER WERE DULY REGISTERED WITH THE VAT AUTHORITY HAVING TIN AS FOLLOWS: M/S BALAJI ENTERPRISES - 09465706633, M/S BAJRANJ TRADING CO. - 09166106335, M/S SC TRADING CO. - 09265706785; AND VAT @ 4.5% / 5% AS APPLICABLE WAS ALSO DEDUCTED ON THE SALES. THE APPROPRIATE COURSE OF ACTION IN THE CIRCUMSTANCES WAS TO I NFORM THE V AT AUTHORITIES ABOUT THE TAX DEDUCTED SO THAT THE DEPOSIT OF TAX COULD HAVE BEEN VERIFIED BY THEM. THE AO OF THE SELLING PARTIES COULD HAVE ALSO BEEN INFORMED ABOUT THE SALES MADE AND WHETHER THESE HAD BEEN REFLECTED IN IHE TAX RETURNS FILED AN D TO TAKE ACTION IF NO RETURN HAD BEEN FILED. IN ANY CASE, ADVERSE VIEW COULD STILL HAVE BEEN TAKEN AGAINST THE APPELLANT IF NEITHER THE VAT HAD BEEN DEPOSITED NOR THE SAID PARTY FILED ANY INCOME - TAX RETURN. MOREOVER, THE BANK ACCOUNT OF THE PARTY, AVAILA BLE WITH THE AO, COULD ALSO HAVE BEEN FURTHER INVESTIGATED. NONE OF THESE COURSES OF ACTION APPEAR TO HAVE BEEN TAKEN BY THE REVENUE, 11 INSTEAD, ADDITION WAS MADE FOR THE REASONS OF NOT FINDING AND NON PRODUCTION OF THE SAID PARTIES. BUSINESS RELATION CAN BE TRANSACTION - BASED, AND IT IS NOT POSSIBLE FOR ANY BUSINESS CONCERN TO PHYSICALLY PRODUCE ALL THE PARTIES WITH WHICH IT MAY HAVE HAD TRANSACTIONS IN THE PAST. THEREFORE, THE ADVERSE INFERENCE DRAWN BY THE REVENUE IS PRE - MATURE AND WITHOUT SOUND BASIS. 6.4 IN THE ABOVE FACTS, CIRCUMSTANCES AND LEGAL POSITION OF THE MATTER, THE ADDITION MADE CANNOT BE LEGALLY SUSTAINED AND IS DELETED. APPELLANT GETS RELIEF OF RS.5,08,25,724/ - . 8.5 B EFORE US, THE LD. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE LD. CIT - ( A ) FOUND VARIOUS DEFECTS IN THE CONCLUSION ARRIVED BY THE ASSESSING OFFICER , HOWEVER , HE NEITHER DIRECTED THE ASSESSING OFFICER TO CARRY OUT NECESSARY ENQUIRIES NOR HE HIMSELF CARRIED OUT ANY ENQUIRIES TO ASCERTAIN THE TRUE NATURE OF THE EXPENSES IN DISPUTE . ACCORDING TO HER , THE INITIAL BURDEN OF PROOF OF IDENTITY OF THE SUPPLIERS WAS NOT DISCHARGED BY THE ASSESSEE. IN SUPPORT OF HER CONTENTION, SHE RELIED ON THE DECISION OF THE HON BLE DELHI HIGH COURT IN THE CASE OF COMMISSIONER OF INCOME TAX VERSUS JANSA MPARK ADVERTISING AND MARKETING PRIVATE LIMITED REPORTED IN 375 ITR 373, WHEREIN IT IS HELD THAT THE CIT (APPEALS), HAVING NOTICE TO WANT OF PROPER ENQUIRY, COULD NOT HAVE CLOSE THE CHAPTER SIMPLY ALLOWING THE APPEAL AND DELETING THE ADDITIONS MADE AND IT WAS THE OBLIGATION OF THE FIRST APPELLATE AUTHORITY AS WELL AS OF THE ITAT TO ENSURE THAT EFFECTIVE ENQUIRY WAS CARRIED OUT. ACCORDINGLY, S HE REQUESTED THAT THE MATTER MAY BE RESTORED BACK TO THE FILE OF THE ASSESSING OFFICER. 8 .6 WE HAVE HEARD THE SUBMISS ION OF THE LD. DR AND PERUSED THE RELEVANT MATERIAL ON RECORD. IN TH E INSTANT CASE, SH. ANIL SHARMA , THE DIRECTOR OF THE ASSESSEE COMPANY , DURING STATEMENT UNDER SECTION 132 (4) OF THE ACT , SURRENDERED UNEXPLA INED PURCHASES AMOUNTING TO RS. 44,87,02,688/ - WHICH INCLUDED THE UNEXPLAINED PURCHASES IN DISPUTE 12 ALSO. NOTHING HAS BEEN BROUGHT ON RECORD BY THE ASSESSEE THAT SH. ANIL SHARMA RETRACTED AT ANY TIME FROM THE STATEMENT GIVEN BY HIM UNDER SECTION 132 (4) OF THE ACT . THE SUMMONS ISSUED TO CONCERNED SUPPLIE RS ALSO REMAIN UNSERVED AND THE ASSESSEE ALSO FAILED TO PRODUCE THOSE PARTIES BEFORE THE ASSESSING OFFICER. 8.6.1 THE LD. CIT - ( A ) POINTED OUT FOLLOWING DEFECTS AND OBSERVED THAT THE ASSESSING OFFICER DID NOT CARRY OUT ENQUIRIES WHICH SHOULD HAVE BEEN CARR IED OUT IN THE CASE: I . IT WAS NOT APPROPRIATE TO ENFORCE TO PRODUCE THE PARTIES FOR PHYSICAL VERIFICATION WITHOUT FINDING ANY DEFECT IN THE DOCUMENTARY EVIDENCE PRODUCED. II . THE AO SHOULD HAVE INFORMED THE VAT AUTHORITIES ABOUT THE TAX DEDUCTED AND VERIFIED TH E VAT SO DEPOSITED. III . THE AO SHOULD HAVE INFORMED THE ASSESSING OFFICER OF THE SUPPLIER PARTIES FOR TAKING ANY ACTION IN THEIR HANDS IF SO REQUIRED. IV . THE AO SHOULD HAVE INVESTIGATED THE BANK ACCOUNTS OF THE SUPPLIER PARTIES. 8.6.2 WE FIND THAT LD. CIT - ( A ) NEITHER CALLED FOR A REMAND REPORT FROM THE ASSESSING OFFICER NO R CARRIED OUT ENQUIRIES HIMSELF. IN THE CASE OF JANSAMPARK ADVERTISING AND MARKETING PRIVATE L IMITED (SUPRA) , SIMILAR FACTS AND CIRCUMSTANCES WERE EXISTED. IN THE SAID CASE ALSO , THE SUMMONS ISSUED TO ALLEGED SHARE APPLICANTS WERE RETURNED UNSERVED WITH REMARKS LEFT/NO SUCH PERSON . IN THE SAID CASE ALSO , THE ASSESSING OFFICER OBSERVED A PATTERN OF CASH DEPOSIT OF EQUAL AMOUNT BY CASH OR CHEQUE IN RESPECTIVE BANK ACCOUNTS. IN THE SAID CASE AL SO, THE ASSESSEE FILED DOCUMENT LIKE COPY OF SUBSCRIPTION OF SHARES, CONFIRMATION, COPY OF COMPANY MASTER DATA FROM THE OFFICE OF THE ROC, ACKNOWLEDGEMENT OF FILING OF INCOME TAX RETURN , THE PERMANENT ACCOUNT NUMBER ETC . IN THE SAID 13 CASE, THE CIT - ( A ) AND T HE TRIBUNAL ACCEPTED ARGUMENTS OF THE ASSESSEE , HOWEVER , THE HON BLE HIGH COURT REMITTED THE MATTER TO THE CIT - (A) FOR FRESH CONSIDERATION/ ADJUDICATION IN ACCORDANCE WITH THE LAW. THE HON BLE HIGH COURT OBSERVED THAT IF THE CIT - (A) NOTICE D CERTAIN DEFAULT ON THE PART OF THE ASSESSING OFFICER, IN THAT EVENT , THEY ARE DUTY BOUND TO EITHER THEMSELVES INQUIRE OR CAUSE SUCH ENQUIRY TO BE COMPLETED . THE RELEVANT PARAGRAPH 35 OF THE ORDER OF THE HON BLE DELHI HIGH COURT IS REPRODUCED AS UNDER: 35. ASSESSMENT PROCEEDINGS UNDER THE INCOME TAX ACT ARE NOT A GAME OF HIDE AND SEEK. THE INQUIRY IN THE WAKE OF A NOTICE UNDER SECTION 148 IS NOT AN EMPTY FORMALITY. IT MUST BE EFFECTIVE AND WITH A SENSE OF PURPOSE. THERE IS AN ELABORATE PROCEDURE SET OUT WHICH REQUIRES SCRUPULOUS ADHERENCE AND FOLLOWED UP ON. IN THE HIERARCHY OF THE AUTHORITIES, THE AO IS PLACED AT THE BOTTOM RUNG. THE TWO LAYERS OF A PPEALS, BEFORE THE MATTER ENGAGES THE APPELLATE JURISDICTION OF THIS COURT, ARE AUTHORITIES VESTED WITH THE JURISDICTION, POWER AND OBLIGATION TO REACH APPROPRIATE FINDINGS ON FACTS. NOTICEABLY, IT IS ONLY THE APPEAL TO THE HIGH COURT, UNDER SECTION 260 - A , WHICH IS RESTRICTED TO CONSIDERATION OF 'SUBSTANTIAL QUESTION OF LAW', IF ANY ARISING. AS WOULD BE SEEN FROM THE DISCUSSION THAT FOLLOWS, THE OBLIGATION TO MAKE PROPER INQUIRY AND REACH FINDING ON FACTS D OES NOT END WITH THE AO. THIS OBLIGATION MOVES UPWARDS TO CIT (APPEALS), AND ALSO ITAT, SHOULD IT COME TO THEIR NOTICE THAT THERE HAS BEEN DEFAULT IN SUCH RESPECT ON THE PART OF THE AO. IN SUCH EVENT, IT IS THEY WHO ARE DUTY BOUND TO EITHER THEMSELVES PROP ERLY INQUIRE OR CAUSE SUCH INQUIRY TO BE COMPLETED. IF THIS WERE NOT TO BE DONE, THE POWER UNDER SECTION 148 WOULD BE RENDERED PRONE TO ABUSE. 8.6.3 THE HON BLE HIGH COURT FURTHER IN P ARA S - 38 AND 39 , OBSERVED THAT VARIOUS PROVISIONS UNDER WHICH THE LD. CIT - ( A ) COULD HAVE CARRIED OUT ENQUIRIES. THE RELEVANT PARAGRAPHS ARE REPRODUCED AS UNDER: 38. THE PROVISION OF APPEAL, BEFORE THE CIT (APPEALS) AND THEN BEFORE THE ITAT, IS MADE MORE AS A CHECK ON T HE ABUSE OF POWER AND AUTHORITY BY THE AO. WHILST IT IS TRUE THAT IT IS THE OBLIGATION OF THE AO TO CONDUCT PROPER SCRUTINY OF THE MATERIAL, GIVEN THE FACT THAT THE TWO APPELLATE AUTHORITIES ABOVE ARE ALSO FORUMS FOR FACT - FINDING, IN THE EVENT OF AO FAILIN G TO 14 DISCHARGE HIS FUNCTIONS PROPERLY, THE OBLIGATION TO CONDUCT PROPER INQUIRY ON FACTS WOULD NATURALLY SHIFT TO THE DOOR OF THE SAID APPELLATE AUTHORITY. FOR SUCH PURPOSES, WE ONLY NEED TO POINT OUT ONE STEP IN THE PROCEDURE IN APPEAL AS PRESCRIBED IN SECTION 250 OF THE INCOME TAX ACT WHEREIN, BESIDES IT BEING OBLIGATORY FOR THE RIGHT OF HEARING TO BE AFFORDED NOT ONLY TO THE ASSESSEE BUT ALSO THE AO, THE FIRST APPELLATE AUTHORITY IS GIVEN THE LIBERTY TO MAKE, OR CAUSE TO BE MADE, 'FURTHER INQUIRY', IN TERMS OF SUB - SECTION (4) WHICH READS AS UNDER: - THE COMMISSIONER (APPEALS) MAY, BEFORE DISPOSING OF ANY APPEAL, MAKE SUCH FURTHER INQUIRY AS HE THINKS FIT, OR MAY DIRECT THE ASSESSING OFFICER TO MAKE FURTHE R INQUIRY AND REPORT THE RESULT OF THE SAME TO THE COMMISSIONER (APPEALS). 39. THE FURTHER INQUIRY ENVISAGED UNDER SECTION 250(4) QUOTED ABOVE IS GENERALLY BY CALLING WHAT IS KNOWN AS 'REMAND REPORT'. THE PURPOSE OF THIS ENABLING CLAUSE IS ESSENTIALLY TO ENSURE THAT THE MATTER OF ASSESSMENT REACHES FINALITY WITH ALL THE REQUISITE FACTS FOUND. THE ASSESSMENT PROCEEDINGS RE - OPENED ON THE BASIS OF PRELIMINARY SATISFACTION THAT SOME PART OF THE INCOME HAS ESCAPED ASSESSMENT, PARTICULARLY WHEN SOME UNEXPLAINED CREDIT ENTRIES HAVE COME TO THE NOTICE (AS IN SECTION 68 ), CANNOT CONCLUDE, SAVE AND EXCEPT BY REACHING SATISFACTION ON THE TOUCHSTONE OF THE THREE TE STS MENTIONED EARLIER; VIZ. THE IDENTITY OF THE THIRD PARTY MAKING THE PAYMENT, ITS CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION. WHILST IT IS TRUE THAT THE ASSESSEE CANNOT BE CALLED UPON TO ADDUCE CONCLUSIVE PROOF ON ALL THESE THREE QUESTIONS, IT I S NONETHELESS LEGITIMATE EXPECTATION OF THE PROCESS THAT HE WOULD BRING IN SOME PROOF SO AS TO DISCHARGE THE INITIAL BURDEN PLACED ON HIM. SINCE SECTION 68 ITSELF DECLARES THAT THE CREDITED SUM WOULD HAVE TO BE INCLUDED IN THE INCOME OF THE ASSESSEE IN THE ABSENCE OF EXPLANATION, OR IN THE EVENT OF EXPLANATION BEING NOT SATISFACTORY, IT NATURALLY FOLLOWS THAT THE MATERIAL SUBMITTED BY THE ASSESSEE WITH HIS EXPLANATION MUST ITSELF BE WHOLESOME OR NOT UNTRUE. IT IS ONLY WHEN THE EXPLANATION AND THE MATERIAL OFFERED BY THE ASSESSEE AT THIS STAGE PASSES THIS MUSTER THAT THE INITIAL ONUS PLACED ON HIM WOULD SHIFT LEAVING IT TO THE AO TO START INQUIRING INTO THE AFFAIRS OF THE THIRD PARTY. 8.6.4 THE HON B LE HIGH COURT ALSO OBSERVED IN P ARA - 40 THAT DOUBTS AS TO THE GENUINENESS OF THE SOME OF THE PARTIES PERSISTING ON ACCOUNT OF NON - DELIVERY OF THE PROCESS, THE INITIAL BURDEN OF THE ASSESSEE TO ADDUCE PROOF OF IDENTITY, CANNOT BE TREATED AS DISCHARGED. 8.6.5 IN P ARA - 42 AND 43 OF THE JUDGMENT , THE HON BLE HIGH COURT REMITTED THE MATTER TO THE CIT - (A) FOR FRESH CONSIDERATION /ADJUDICATION IN 15 ACCORDANCE WITH LAW. THE RELEVANT FINDING OF THE HON BLE HIGH COURT IS REPRODUCED AS UNDER: 42. THE AO HERE MAY HAVE FAILED TO DISCHARGE HIS OBLIGATION TO CONDUCT A PROPER INQUIRY TO TAKE THE MATTER TO LOGICAL CONCLUSION. BUT CIT (APPEALS), HAVING NOTICED WANT OF PROPER INQUIRY, COULD NOT HAVE CLOSED THE CHAPTER SIMPLY BY ALLOWING THE APPEAL AND DELETING THE ADDITIONS MADE. IT WAS ALSO THE OBLIGATION OF THE FIRST APPELLATE AUTHORITY, AS INDEED OF ITAT, TO HAVE ENSURED THAT EFFECTIVE INQUIRY WAS CARRIED OUT, PARTICULARLY IN THE FACE OF THE ALLEGATIONS OF THE REVENUE THAT THE ACCOUNT STATEMENTS REVEAL A UNIFORM PATTERN OF CASH DE POSITS OF EQUAL AMOUNTS IN THE RESPECTIVE ACCOUNTS PRECEDING THE TRANSACTIONS IN QUESTION. THIS NECESSITATED A DETAILED SCRUTINY OF THE MATERIAL SUBMITTED BY THE ASSESSEE IN RESPONSE TO THE NOTICE UNDER S ECTION 148 ISSUED BY THE AO, AS ALSO THE MATERIAL SUBMITTED AT THE STAGE OF APPEALS, IF DEEMED PROPER BY WAY OF MAKING OR CAUSING TO BE MADE A 'FURTHER INQUIRY' IN EXERCISE OF THE POWER UNDER SECTION 250(4) . THIS APPROACH NOT HAVING BEEN ADOPTED, THE IMPUGNED ORDER OF ITAT, AND CONSEQUENTLY THAT OF CIT (APPEALS), CANNOT BE APPROVED OR UPHELD. 43. IN THE RESULT, THE QUESTIONS OF LAW STAND ANSWERED IN FAVOUR OF THE REVENUE THOUGH WITH A DIRECTION THAT TH E MATTER OF ASSESSMENT ARISING OUT OF NOTICE UNDER SECTION 148 INCOME TAX ACT ISSUED ON 18.04.2007 FOR AY 2004 - 05 IN RESPECT OF THE ASSESSEE WOULD STAND REMITTED TO THE CIT (APPEALS) FOR FRESH CONSIDERATI ON/ADJUDICATION IN ACCORDANCE WITH LAW. 8.6.6 IN THE INSTANT CASE ALSO , THE LD. CIT - ( A ) NOTICED THAT PROPER ENQUIRIES HAVE NOT BEEN CONDUCTED BY THE ASSESSING OFFICER, HOWEVER , RATHER THAN GETTING THE ENQUIRIES DONE, HE SIMPLY ALL OWED THE APPEAL OF THE ASSESSEE . IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE INSTANT CASE, BEING MORE OR LESS SIMILAR TO THE FACTS AND CIRCUMSTANCES IN THE CASE OF JANSAMPARK ADVERTISING AND MARKETING PRIVATE LIMITED (SUPRA), WE FEEL IT APPROPRIATE TO RESTORE THE MATTER TO THE LD. CIT - (A) FOR ADJUDICATING AFRESH IN ACCORDANCE WITH LAW. THE LD. CIT - (A) WILL ENSURE THAT EFFECTIVE INQUIRIES ARE MADE IN THE CASE. IF REQUIRED SO, HE MAY REMAND THE MATTER TO THE LD. ASSESSING OFFICER AND CARRY OUT ENQUIRY TO ASCERTAIN DELIVERY, TRANS PORTATION & CONSUMPTION OF GOODS. HE MAY ALSO EXAMINE BANK 16 ACCOUNT OF THE PURCHASING PARTIES TO FIND OUT, WHETHER THE ASSESSEE OR ITS EMPLOYEES HAS WITHDRAWN THE MONEY IN CASH FROM THOSE ACCOUNTS. HE WILL ALSO ENSURE THAT BOTH THE PARTIES I.E. THE ASSESSING OFFICER AND THE ASSESSEE , ARE PROVIDED ADEQUATE OPPORTUNITY OF BEING HEARD. ACCORDINGLY, THE GROUND OF THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 9. THE GROUND NO. 3 ( WRONGLY WRITTEN AS GROU ND NO. 10) RELATES TO ADDITION OF RS. 4, 50,00,000/ - MADE BY THE ASSESSING OFFICER AS UNEXPLAINED RECEIPT IN THE TRANS ACTIONS WITH M/S MOON BUILDTECH PRIVATE L IMITED. 9.1 FACTS QUA THE ADDITION ARE THAT A MEMORANDUM OF UNDERSTANDING (MOU) BET WEEN THE ASSESS EE AND M/S MOON BUILDTECH PRIVATE L IMITED (MBPL) WAS SEIZED DURING THE COURSE OF SEARCH. ACCORDING TO THE MOU, M/S. MBPL PAID 9 ( NINE ) CHEQUES OF RS.25,000 EACH DATED 13/06/2008 TOWARDS FULL AND FINAL PAYMENT OF 9 ( NINE ) FLATS ALLOCATED BY THE ASSESSEE WIT H NUMBERS AND TOWERS OF EA CH FLAT DULY SPECIFIED. HOWEVER , DURING ASSESSMENT PROCEEDING I T WAS SUBMITTED BY MBPL THAT INVESTMENT WAS MADE IN THREE FLATS (TOWERS DIFFERENT THEN ME NTIONED IN MOU) EACH AT THE RS. 75,00, 000/ - . THE ASSESSIN G OFFICER ASKED M/S MB PL TO PRODUCE THE AGREEMENT IN RESPECT OF PURCHASE OF THREE FLATS AND OTHER DETAILS. IN RESPONSE, SH. SUBHASH JAIN , DIRECTOR OF M/S MBPL ATTENDED BEFORE THE ASSESSING OFFICER, HOWEVER , DID NOT FILE DETAILS OR EXPLANATION IN RESPECT OF THE AGREEMENTS. ACCORDING TO THE ASSESSING OFFICER , HE COULD NOT CONVINCINGLY GIVE REPLY TO THE QUESTIONS ASKED BY THE ASSESSING OFFICER. IN VIEW OF THE ABOVE FACTS, THE ASSESSING OFFICER WAS OF THE OPINIO N THAT THE ASSESSEE HAS SOLD NINE FLATS AT THE RATE OF RS.75,00,000/ - PER FLAT IN RESPECT OF WHICH PAYMENT THROUGH CHEQUE WERE MADE AT THE RATE OF RS.25,00,000/ - PER FLA T AND THE BALANCE AMOUNT OF RS.50, 00,000 / - PER FLAT 17 WERE RECEIVED IN CASH AND ACCORDING LY , HE MADE THE ADDITION OF RS.4,50,00,000/ - 9.2 BEFORE THE LD. CIT - ( A ) , THE ASSESSEE SUBMITTED THAT IT WAS A CASE OF EXTENSION OF THE ORIGI NAL FINANCING AGREEMENT OF JUNE, 2008 AND NINE FLATS WERE ALLOCATED AGAINST THE ASSURED RETURN AND THERE IS NO EVIDE NCE THAT NINE FLATS/THREE FLATS WERE SOLD BY THE ASSESSEE AND PURCHASED BY M/S. MBPL. THE LD. CIT - ( A ) MENTIONED THAT THESE FLATS CONTINUE D TO BE REFLECTED IN THE BALANCE SHEET OF THE ASSESSEE COMPANY. THE RELEVANT FINDING OF THE LD. CIT - (A) IS REPRODUCED A S UNDER: 7.3 I HAVE CONSIDERED THE RIVAL CONTENTIONS IN THE MATTER. IT IS APPARENT FROM THE MOU ITSELF THAT THE TRANSACTION IS A FINANCING TRANSACTION. THE VIEW OF THE ASSESSING OFFICER AROSE FROM THE FACT THAT HE ASSUMED THAT SINCE 3 FLATS WERE HELD BY MB PI. @ RS.75,00,000/ - PER HAT, THE ACTUAL CONSIDERATION FOR 9 FLATS WAS RS.6,75,00,000/ - ALSO @ RS.75,00,000/ - PER FLAT. THE APPELLANT, ON THE OTHER HAND, CLAIMS THAT THIS WAS A CASE OF EXTENSION OF THE ORIGINAL FINANCING AGREEMENT OF JUNE, 2008 AND THE AMOUNT INVOLVED REMAINED RS.2,25,00,000/ - . DURING FY 2009 - 10, VIDE THE MOU DATED 16.08.2009, THE FMANCER EXTENDED THE AGREEMENT AND WAS ALLOCATED 9 FLATS AND ALSO THE ASSURED RETURN. IT IS TRITE THAT SHORT TERM MARKET BORROWINGS CARRY HIGH INTEREST RATES. 'THERE IS NO EVIDENCE THAT THE 9 FLATS / 3 FLATS WERE SOLD BY THE APPELLANT AND PURCHASED BY MBPL. NO DOUBT RIGHT TO BOOK THE FLATS WAS ALSO VESTED IN MBPL AS SURETY, BUT THAT DOES NOT NECESSARILY LEAD TO THE CONCLUSION THAT THE FLATS WERE SOLD BY THE APP ELLANT TO MBPL. THERE IS NO EVIDENCE THAT THE 3/9 FLATS WERE SOLD BY MBPL. THERE IS NO EVIDENCE THAT THE APPELLANT RECEIVED ANY FURTHER CONSIDERATION OR ON MONEY FROM MBPL. THE REASON WHY THESE FLATS DID NOT APPEAR IN THE BALANCE SHEET OF MBPL IS THAT THE OWNERSHIP RIGHTS IN THESE FLATS WERE NEVER TRANSFERRED BY THE APPELLANT TO MBPL. IN FACT, THESE FLATS CONTINUED TO BE REFLECTED IN THE BALANCE SHEET OF THE APPELLANT COMPANY, AS OWNERSHIP IN THESE FLATS CONTINUED TO BE VESTED IN THE APPELLANT. IF THERE WAS SOME EVIDENCE OF PAYMENT OF CASH OVER AND ABOVE PAYMENTS BY CHEQUE FROM MBPL TO THE APPELLANT, THEN IT WOULD HAVE BEEN A DIFFERENT MATTER. HOWEVER, UNDISPUTEDLY THERE IS NO SUCH EVIDENCE. THERE CANNOT BE ANY PRESUMPTION AS TO A FACT. 18 9.3 BEFORE US , THE LD. CIT( DR ) SUBMITTED THAT NO PROPER ENQUIRIES HAVE BEEN DONE ON THE ISSUE IN DISPUTE EITHER BY THE ASSESSING OFFICER OR BY THE LD. CIT - ( A ) . ACCORDING TO HER , THE LD. CIT - ( A ) HAS RELIED ON CERTAIN FACTS WHICH WERE FILED FIRST - TIME BEFORE HIM LIKE MOU AN EX TENSION OF FINANCING AGREEMENTS , FLATS CONTINUE D TO BE APPEARING IN THE BALANCE SHEET OF THE ASSESSEE COMPANY ETC. SHE SUBMITTED THAT THIS ISSUE MAY ALSO BE RESTORED TO THE FILE OF THE LD. CIT - (A) FOR CARRYING OUT DETAILED ENQUIRIES. 9.4 WE HAVE HEARD THE SUBMISSION OF THE LD. DEPARTMENTAL REPRESENTATIVE AND PERUSED THE MATERIAL ON RECORD. WE FIND THAT THE ASSESSEE DID NOT PRODUCE THE AGREEMENTS CLAIMING THAT M/S MBPL INVESTED ONLY IN THREE FLATS. THUS , THERE BEING OBVIOUS CONTRADICTION IN THE MOU FOUND D URING THE COURSE OF SEARCH AND THE CLAIM OF THE ASSESSEE, THE ASSESSING OFFICER PRESUMED THAT THE ASSESSEE SOLD THE FLATS AT THE T HE VALUE OF EACH FLAT BEING RS. 75,00,000/ - AND ACCORDINGLY , HE PRESUMED THAT BALANCE AMOUNT OF RS. 4, 50,00,000 / - WAS PAID IN CASH. THE LD. CIT - (A) ON THE BASIS OF THE SUBMISSION OF THE ASSESSEE ALLOWED RELIEF TO THE ASSESSEE. THE LD. CIT - (A) DID NOT VERIFY THE AGREEMENTS IN RESPECT OF THREE FLATS. HE DID NOT VERIFY AS WHY THE FLAT NUMBERS OF THE THREE FLATS CLAIMED TO HAVE BEEN BOOKED BY M/S MBPL DIFFERS FROM THE FLAT NUMBERS MENTIONED IN MOU. THE LD. CIT - (A) HAS MENTIONED THAT THESE FLATS CONTINUE D TO BE REFLECTED IN THE BALANCE SHEET OF THE ASSESSEE COMPANY , HOWEVER, HE HAS NOT MENTIONED, WHETHER THE EVIDENCES RE LIED UPON BY HIM IN THIS REGARD ARE ADDITIONAL EVIDENCE . THE ASSESSING OFFICER HAS ALSO NOT BEEN PROVIDED OPPORTUNITY TO REBUT THOSE EVIDENCES. IF ACCORDING TO THE LD. CIT - (A) , THERE WAS NO SALE OF THE FLATS TO M/S MBPL, THEN HE HAS NOT BROUGHT ON RECORD W HETHER THE MONEY INVESTED BY M BPL WAS RETURNED BACK BY THE ASSESSEE ALONGWITH INTEREST. WE FIND 19 THAT HON BLE DELHI HIGH C OURT IN THE CASE OF JANSAMPARK ADVERTISING AND M ARKETING PRIVATE L IMITED (SUPRA) HAS OBSERVED THAT IN THE EVENT OF AO FAILING TO DISCHA RGE ITS FUNCTION PROPERLY, THE OBLIGATION TO CONDUCT PROPER INQUIRY ON THE FACTS WERE NATURALLY SHIFT TO THE DOOR OF THE FIRST APPELLATE AUTHORITY. THE RELEVANT PARAGRAPHS OF THE DECISION OF OF THE HON BLE HIGH COURT HAS ALREADY BEEN REPRODUCED BY U S IN PR ECEDING PARAGRAPHS. THUS, RESPECTFULLY , FOLLOWING THE FINDING OF THE HON BLE DELHI HIGH C OURT IN THE CASE OF JANSAMPARK ADVERTISING AND M ARKETING P RIVATE LIMITED (SUPRA), WE FEEL IT APPROPRIATE TO RESTORE THE ISSUE TO THE FILE OF THE LD. CIT - (A) , WITH THE DIRECTION TO CARRY OUT EFFECTIVE INQUIRIES AND DECIDE THE ISSUE AFRESH IN ACCORDANCE WITH LAW. B OTH THE PARTIES SHALL BE AFFORDED ADEQUATE OPPORTUNITY OF BEING HEARD. ACCORDINGLY , THE GROUND OF THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 10. THE GROUND NO. 10 OF THE APPEAL RELATES TO ADDITION OF RS. 15,93,836/ - MADE ON ACCOUNT OF SCRAP SALES. 10.1 THE ASSESSEE ADJUSTED SALE OF SCRAP AMOUNTING TO RS. 15,93,836/ - AGAINST THE PURCHASES EXPENDITURE AND TRANSFERRED THE AMOUNT OF PURCHASE TOWARDS WORK IN PROGRESS. ACC ORDING TO THE ASSESSING OFFICER, THE SALE OF SCRAP SHOULD HAVE BEEN SHOWN SEPARATELY AS INCOME AS IT IS NOT PART OF COST/WORK IN PROGRESS. ACCORDING TO LD. CIT - (A) , THE SCRAP IS NECESSARY GENERATED FROM THE CONSTRUCTION ACTIVITY AND , THUS , ADJ USTMENT BY THE ASSESSE E AGAINST THE PURCHASE ACCOUNT , WOULD NOT EFFECT THE ULTIMATE INCOME OF THE ASSESSEE. THE RELEVANT FINDING OF THE LD. CIT - (A) IS REPRODUCED AS UNDER: 4.2 I HAVE CONSIDERED THE ASSESSMENT ORDER AND THE SUBMISSIONS MADE. THE APPELLANT IS ENGAGED IN CONSTRUCTION ACTIVITY. SCRAP IS NECESSARILY GENERATED FROM SUCH ACTIVITY. THERE ARE TWO WAYS THE APPELLANT CAN ACCOUNT FOR THE INCOME FROM SALE OF SCRAP IT CAN C REDIT THE OTHER/MISC. INCOME 20 ACCOUNT; OR IT CAN REDUCE THE INCOME FROM THE COST OF CONSTRUCTION AS IT HAS DONE. IN EITHER CASE, THE INCOME WILL BE ACCOUNTED FOR UNDER THE HEAD BUSINESS , AND NOT UNDER THE HEAD OTHER SOURCES AS HAS BEEN DONE BY THE REV ENUE. EVEN IF , T HE INCOME IS CHARGED UNDER THE HEAD OTHER SOURCES , THERE WILL BE NO DIFFERENCE TO THE OVERALL INCOME OF THE APPELLANT AS THE COST OF CONSTRUCTION WILL HAVE TO BE INCREASED, THUS, REDUCING THE INCOME UNDER THE HEAD BUSINESS BY EQUAL AMOUNT. IN ANY VIEW OF THE MATTER THE AD DITION MADE BY THE REVENUE IS ERRONEOUS. THE ADDITION OF RS.15,93,836/ - IS, THEREFORE, DELETED. 10.2 THE LD. CIT (DR) RELIED ON THE ORDER OF THE ASSESSING OFFICER. 10.3 WE HAVE HEARD THE SUBMISSION OF LD. DR AND PERUSED THE RELEVANT MATERIAL ON RECORD. W E AGREE WITH THE FINDING OF THE LD. CIT - (A) THAT SCRAP IS NECESSARILY GENERATED FROM THE CONSTRUCTI ON ACTIVITY . THE ASSESSEE HAS ADJUSTED RECEIPT FROM THE SALE OF SCRAP TO WARDS THE COST OF CONSTRUCTION. THUS , TO THAT EXTENT, THE COST OF CONSTRUCTION HAS BE EN REDUCED. ACCORDING TO US, IN THE NORMAL PRESENT ATION OF ACCOUNT, ANY RECEIPT O R INCOME IS CREDITED TO THE RIGHT HAND SIDE OF THE PROFIT AND LOSS ACCOUNT AND ANY EXPENDITURE OR LOSS IS DEBITED TO THE LEFT HAND SIDE OF THE PROFIT AND LOSS ACCOUNT. ANOTHER WAY OF PRESENTATION COULD BE OF ADJUSTING THE ACCOUNT OF RECEIPT OR INCOME AGAINST EXPENDITURE OR VICE VERSA AND DEBIT OR CREDIT THE EXCESS EXPENDITURE OR INCOME ON RESPECTIVE SIDE. THE RESULTANT EFFECT OF BOTH THE WAYS OF PRESENTATION ON THE PROFIT OR LOSS OF THE ASSESSEE WOULD BE SAME. BUT, THE EFFECT WOULD BE DIFFERENT, IF EITHER THE EXPENDITURE OR INCOME HAS NOT BEEN CLAIMED IN THE RELEVANT YEAR. IN THE CASE, THE ASSESSEE HAS SHOWN INCOME FROM SALE OF SCRAPS AND ADJUSTED THE SAME AGAINST THE CONSTRUC TION EXPENSES, BUT IT IS NOT CLEAR WHETHER THE CONSTRUCTION EXPENSES HAVE BEEN CLAIMED IN THE YEAR UNDER CONSIDERATION OR CARRIED TO WORK - IN - PROGRESS. IN CASE THE COST OF CONSTRUCTION AFTER ADJUSTMENT OF SALE OF SCRAP IS TRANSFERRED TO WORK - IN - 21 PROGRESS, IN THAT SITUATION , THE SALE OF SCRAP WOULD BE TAXABLE AS INCOME IN THE YEAR UNDER CONSIDERATION, WHEREAS THE COST OF CONSTRUCTION WOULD BE CLAIMED AS EXPENDITURE IN THE LATER YEARS. 10.4 SINCE I N THE INSTANT CASE , IT IS NOT CLEAR , WHETHER THAT ASSESSEE HA S DEBITED THE COST OF CONSTRUCTION IN THE PROFIT AND LOSS ACCOUNT OR IT HAS CARRIED THE COST OF CONSTRUCTION AS WORK IN PROGRESS FOR ADJUSTMENT IN SUBSEQUENT YEARS AS EXPENDITURE. 10.5 IN CASE , THE COST OF CONSTRUCTION HAS BEEN CARRIED AS WORK IN PROGRES S, IN THAT SITUATION THE FINDING OF THE ASSESSING OFFICER WOULD BE LOGICAL AS INCOME FROM SALE OF THE SCRAP IS RECEIVED/ACCRUED IN THE INSTANT ASSESSMENT YEAR , AND , THUS , ASSESSEE SHOULD HAVE OFFERED THE RECEIPT FROM SALE OF SCRAP AS INCOME IN THE YEAR UN DER CONSIDERATION . 10.6 IN VIEW OF THE ABOVE, WE FEEL IT APPROPRIATE TO RESTORE THE MATTER TO THE FILE OF THE LD. CIT - (A) TO VERIFY THE FACT THAT COST OF CONSTRUCTION HAS BEEN CLAIMED AS EXPENDITURE IN THE YEAR UNDER CONSIDERATION OR NOT AND ADJUDICATE T HE ISSUE ACCORDINGLY, IN ACCORDANCE WITH LAW. IN THE RESULT, THE GROUND OF THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 11. THE GROUND NO. 5 (WRONGLY MENTIONED AS GROUND NO. 12) IS GENERAL IN NATURE AND THUS DISMISSED AS INFRUCTUOUS. 12. IN THE RESULT , APPEAL OF THE R EVENUE IS PARTLY ALLOWED FOR STATISTICAL PURPOSES. ITA NO. 1877/DEL/2014 FOR AY: 2011 - 12 13. NO W WE TAKE UP THE APPEAL OF THE R EVENUE IN ITA NO. 1877/DEL/2014 FOR ASSESSMENT YEAR 2011 - 12 IN THE CASE OF ULTRA HOME CONSTRUCTION PRIVATE L IMITED. 14. THE G ROUNDS OF APPEAL RAISED BY THE R EVENUE ARE REPRODUCED AS UNDER: 22 1. THE ORDER OF LD. CIT(A) IS NOT CORRECT IN LAW AND FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.60,29,48,80 9/ - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BOGUS PURCHASES. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN LAW IN DELETING THE ADDITION OF RS.97,75,832/ - MADE BY THE AO ON ACCOUNT OF SCRAP SALE. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND ANY/ALL THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF HEARING OF THE APPEAL. 15. THE GROUND NO. 1 OF THE APPEAL IS GENERAL IN NATURE AND COVERED BY THE OTHER GROUNDS OF THE APPEAL AND , THUS , WE ARE NOT ADJUDIC ATING UPON. 16. THE GROUND NO. 2 OF THE APPEAL RELATES TO ADDITION OF RS.60,29,48,809 / - MADE BY THE ASSESSING OFFICER ON ACCOUNT OF BOGUS PURCHASES. THE ADDITION OF BOGUS PURCHASES CONSIST S OF TWO AMOUNTS. THE AMOUNT OF RS.33,19,51,724/ - IS IN RESPECT OF T HE 17 PARTIES AND AMOUNT OF RS. 27,09,97,085 IS IN RESPECT OF THE ONE PARTY. THE FACTS AND CIRCUMSTANCES AND THE FINDING OF THE LD. CIT - (A) IN THE YEAR UNDER CONSIDERATION ARE IDENTICAL TO THE FINDING OF THE LD. CIT - (A) IN THE IMMEDIATELY PRECEDING YEARS I. E. ASSESSMENT YEAR 2010 - 11, WHEREIN IN THE IDENTICAL GROUND RAISED , WE HAVE RESTORE D THE ISSUE TO THE FILE OF THE LD. CIT (A) FOR DECIDING AFRESH. ACCORDINGLY, TO HAVE A CONSISTENT VIEW ON THE ISSUE IN DISPUTE, THIS GROUND OF APPEAL IS ALSO RESTORED TO THE FILE OF THE LD. CIT(A), WITH DIRECTIONS SIMILAR TO WHAT HAS BEEN GIVEN IN ITA NO. 417/DEL/2014 FOR ASSESSMEN T YEAR 2010 - 11. ACCORDINGLY, THE GROUND OF APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 17. THE GROUND NO. 3 OF THE APPEAL RELATES TO ADDITION OF RS.97,75,832/ - MADE BY THE AO ON ACCOUNT OF THE SCRAP SALES. THE IDENTICAL ADDITION IN ASSESSMENT YEAR 2010 - 11 HAS BEEN RESTORED TO THE FILE OF THE LD. CIT - (A) FOR DECIDING IN ACCORDANCE WITH LAW AFTER CERTAIN 23 VERIFICATION. ACCORDINGLY, TO HAVE A CONSISTEN T VIEW, THE ISSUE IN DISPUTE IN THE YEAR UNDER CONSIDERATION IS ALSO RESTORED TO THE FILE OF THE LD. CIT - (A) FOR DECIDING IN ACCORDANCE WITH LAW. ACCORDINGLY, GROUND OF THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 18. THE GROUND NO. 4 OF THE APPEAL BEIN G GENERAL IN NATURE, IT IS DISMISSED AS INFRUCTUOUS. 19. IN THE RESULT , APPEAL OF THE R EVENUE IS ALLOWED PARTLY FOR STATISTICAL PURPOSES. ITA NO.4841/DEL/2014 FOR AY: 2011 - 12 20. NOW , WE TAKE UP THE APPEAL OF THE R EVENUE IN ITA NO. 48 41 /DEL/2014 FOR ASSE SSMENT YEAR 2011 - 12 IN THE CASE OF M/S AMRAPALI PRINCELY STATE PRIVATE L IMITED. THE GROUNDS OF THE APPEAL ARE REPRODUCED AS UNDER: 1. THE ORDER OF LD. CIT(A) IS NOT CORRECT IN LAW AND FACTS. 2. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.31,81,458/ - MADE BY AO ON ACCOUNT OF SALE OF SCRAP. 3. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) HAS ERRED IN DELETING THE ADDITION OF RS.1,50,06,277/ - MADE BY THE AO ON ACCOUNT OF BOGUS PURCHASES WHICH WERE CAPITALIZED. 4. THE APPELLANT CRAVES LEAVE TO ADD, AMEND ANY/ALL THE GROUNDS OF APPEAL BEFORE OR DURING THE COURSE OF HEARING OF THE APPEAL. 21. B RIEFLY STATED FACTS OF THE CASE ARE THAT THE ASSESSEE COMPANY WAS INCORPORATED ON 26.02. 2010 AND WAS ENGAGED IN THE BUSINESS OF BUILDING, CONSTRUCTION AND ALLOTMENT OF RESIDENTIAL/COMMERCIAL PROJECT. THE SEARCH AND SEIZURE ACTION UNDER SECTION 132 OF THE ACT WAS CARRIED OUT IN THE CASE OF THE ASSESSEE ON 09/09/2010 ALONGWITH OTHER CASES OF TH E GROUP. THE ASSESSEE FILED RETURN OF INCOME UNDER SECTION 139 OF THE 24 ACT ON 30/09/2011 DECLARING LOSS OF RS.5,43,987/ - . THE CASE WAS SELECTED FOR SCRUTINY AND NOTICE UNDER SECTION 143(2) OF THE ACT WAS ISSUED AND COMPLIED WITH. THE ASSESSMENT UNDER SECTIO N 143(3) OF THE ACT WAS COMPLETED ON 28/03/2013 AFTER ADDING DISALLOWANCE OF SCRAP SALES TO THE RETURNED LOSS AND WITH THE DIRECTION TO REDUCE THE CLOSING WORK I N PROGRESS BY THE AMOUNT OF RS. 1,50,06,277/ - HELD AS BOGUS PURCHASES. AGGRIEVED, THE ASSESSEE F ILED APPEAL BEFORE THE LD. CIT - (A) , WHO ALLOWED THE APPEAL OF THE ASSESSEE. AGGRIEVED , THE R EVENUE IS IN APPEAL BEFORE THE TRIBUNAL RAISING THE GROUNDS AS REPRODUCED ABOVE. 22. THE GROUND NO. 1 OF THE APPEAL RELATES TO ADDITION OF RS. 31,81,458/ - MADE ON AC COUNT OF SALE OF SCRAP. THE IDENTICAL ISSUE HAS BEEN ADJUDICATED IN ITA NO. 417/DEL/2014 IN THE CASE OF ULTRA HOME CONSTRUCTION PRIVATE L IMITED FOR ASSESSMENT YEAR 2010 - 11 AND ISSUE HAS BEEN RESTORED TO THE FILE OF THE LD. CIT - (A) . TO HAVE A CONSISTENT VIE W, THE ISSUE IN DISPUTE IS ALSO RESTORED TO THE FILE OF THE LD. CIT - (A) FOR DECIDING IN ACCORDANCE WITH LAW. ACCORDINGLY , THE GROUND OF THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 23. THE GROUND NO. 2 OF THE AP PEAL RELATES TO ADDITION OF RS. 1,50,06,277 / - MADE BY THE AO ON ACCOUNT OF THE BOGUS PURCHASES, WHICH HAVE BEEN CAPITALIZED . THE LD. CIT - (A) FOLLOWED HIS FI NDING IN THE CASE OF M/S ULTRA HOME CONSTRUCTION PRIVATE L IMITED IN ASSESSMENT YEAR 2011 - 12 AND ACCORDINGLY , ALLOWED THE APPEAL OF THE ASS ESSEE . AS IN THE CASE OF ULTRA HOME CONSTRUCTION PRIVATE L IMITED FOR ASSESSMENT YEAR 2011 - 12 IN ITA NO. 1877/DEL/2014, WE HAVE ALREADY RESTORED THE ISSUE TO THE FILE OF THE LD. CIT - (A) FOR DECIDING AFRESH. TO HAVE A CONSISTENT VIEW, THE ISSUE IN DISPUTE IN THE YEAR UNDER CONSIDERATION IS ALSO RESTORED TO THE FILE OF LD. CIT - (A) FOR DECIDING AFRESH WITH DIRECTIONS SIMILAR TO WHAT 25 HAVE BEEN GIVEN IN ITA NO. 1877/DEL/2014. ACCORDINGLY , THE GROUND OF THE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. 24. THE GROUND NO. 4 OF THE APPEAL BEING GENERAL IN NATURE, WE ARE NOT REQUIRED TO ADJUDICATE UPON AND DISMISSED AS INFRUCTUOUS. 25. IN THE RESULT , APPEAL OF THE R EVENUE IS ALLOWED PARTLY FOR STATISTICAL PURPOSES. 26. TO SUM UP, THE APPEALS OF THE R EVENUE ARE ALLOWED PARTLY FOR STATISTICAL PURPOSES , WHEREAS CROSS OBJECTIONS OF THE ASSESSEE ARE DISMISSED. THE DECISION IS PRONOUN CED IN THE OPEN COURT ON 1 3 T H FEB . , 201 8 . S D / - S D / - ( AMIT SHUKLA ) ( O.P. KANT ) JUDICIAL MEMBER ACCOUNTANT MEMBER DATED: 1 3 T H FEBRUARY , 201 8 . RK / - (D.T.D) COPY FORWARDED TO: 1 . APPELLANT 2 . RESPONDENT 3 . CIT 4 . CIT(A) 5 . DR ASST. REGISTRAR, ITAT, NEW DELHI