The ITO, Ward-6(4), Ahmedabad V. Shri Rahul A.Saboo, Ahmedabad

ITA 1922/AHD/2012

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 1185 (ITAT-AHMEDABAD)
• Duration Of Justice: 3 year(s) 10 month(s) 7 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 07-07-2016
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: A
• Next Hearing Date: 17-06-2016
• Assessment Year: 2009-2010
• Appeal Filed On: 31-08-2012
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Assessee Lawyers: R I PATEL SHRI S N SOPARKAR
• Keywords: Income from undisclosed sources; Additional evidence; Question of law
• Section: 133(6); 68

Judgement Text

, , IN THE INCOME TAX APPELLATE TRIBUNAL A BENCH, AHMEDABAD .., , !' BEFORE SHRI R.P. TOLANI, JUDICIAL MEMBER AND SHRI ANIL CHATURVEDI, ACCOUNTANT MEMBER SL. NO(S) ITA NO(S) ASSESSMENT YEAR APPEAL(S) BY APPELLANT VS. RESPONDENT APPELLANT RESPONDENT 1. 1922/AHD/2012 2009-10 ITO, WARD-6(4) AHMEDABAD SHRI RAHUL A.SABOO 105, RAJDHANI BUNGALOW RAMWADI ISANPUR AHMEDABAD-382 443 PAN: ANBPS 0552B 2. 192 3 /AHD/2012 2009-10 ITO, WARD-6(4) AHMEDABAD SHRI RAJAT A.SABOO, AHMEDABAD-382443 (ADDRESS SAME AS ABOVE) PAN: ANBPS 0538B 3. 1924 /AHD/2012 2009-10 ITO, WARD-6(4) AHMEDABAD SMT. KRISHNA A.SABOO AHMEDABAD-382 443 (ADDRESS SAME AS ABOVE) PAN: ALUPS 3412G 4. 1925 /AHD/2012 2009-10 ITO, WARD-6(4) AHMEDABAD SMT. MEENU RAHUL SABOO, AHMEDABAD-382 443 (ADDRESS SAME AS ABOVE) PAN: BFAPS 4091 D 5. 1926 /AHD/2012 2009-10 ITO, WARD-6(4) AHMEDABAD SMT. POOJA RAJAT SABOO AHMEDABAD-382 443 (ADDRESS SAME AS ABOVE) PAN: BFAPS 4094G 6. 192 7 /AHD/2012 2009-10 ITO, WARD-6(4) AHMEDABAD SHRI MANISH B. RATHI AHMEDABAD-382 443 (ADDRESS SAME AS ABOVE) PAN: AFIPR9609H REVENUE BY : SHRI R.I. PATEL, CIT-DR ASSESSEE BY : SHRI S.N. SOPARKAR, AR ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 2 - #$ / DATE OF HEARING 17/06/2016 %&'$ / DATE OF PRONOUNCEMENT 07/07/2016 / O R D E R PER BENCH : THIS BUNCH OF SIX APPEALS BY THE REVENUE ARE DIRECT ED SEPARATE ORDERS OF THE COMMISSIONER OF INCOME TAX(APPEALS)-X I AHMEDABAD (CIT(A) IN SHORT) IDENTICALLY DATED 15/06/2012 P ERTAINING TO DIFFERENT ASSESSEES FOR ASSESSMENT YEAR (AY) 2009-10. 2. BEFORE US, AT THE OUTSET, THE LD AR SUBMITTED THAT THOUGH THE APPEALS OF THE REVENUE ARE IN RESPECT OF DIFFERENT ASSESSEE S, BUT ALL THE ASSESSEES BELONG TO ONE FAMILY, THE ISSUES IN ALL THE APPEALS ARE IDENTICAL EXCEPT FOR THE ASSESSMENT YEARS AND AMOUNTS INVOLVED AND THERE FORE THE SUBMISSIONS MADE BY HIM WOULD BE COMMON TO ALL THE APPEALS. THE AFORESAID SUBMISSION OF LD AR WAS NOT OBJECTED TO BY THE LD D R. WE THEREFORE FOR THE SAKE OF CONVENIENCE PROCEED TO DISPOSE OF ALL T HE APPEALS BY WAY OF THE CONSOLIDATED ORDER. WE FOR THE SAKE OF REFERENC E PROCEED WITH THE FACTS IN THE CASE OF SHRI RAHUL SABOO IN ITA NO 192 2/AHD/2012 FOR AY 2009-10 BEING THE LEAD CASE. 2.1. THE RELEVANT FACTS AS CULLED OUT FROM THE MATE RIALS ON RECORD ARE AS UNDER:- ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 3 - 2.2. ASSESSEE IS AN INDIVIDUAL AND PROPRIETOR OF YA MUNA SYNTHETIC MILLS AND M/S. KIRAN FASHIONS STATED TO BE ENGAGED IN THE BUSINESS OF TRADING OF GREY AND PRINTED FABRICS, READY-MADE GAR MENTS AND DRESSING MATERIAL. ASSESSEE FILED HIS RETURN OF INCOME FOR A Y ON 26/09/2009 DECLARING TOTAL INCOME OF RS.10,80,460/-. THE CASE WAS SELECTED FOR SCRUTINY AND THEREAFTER ASSESSMENT WAS FRAMED U/S 1 43(3) OF THE ACT VIDE ORDER DATED 30/12/2011 AND THE TOTAL INCOME WAS DET ERMINED AT RS.75,56,70,856/-. AGGRIEVED BY THE ORDER OF THE A SSESSING OFFICER (AO), ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT (A), WHO VIDE ORDER DATED 15/06/2012 (IN APPEAL NO.CIT(A)-XI/408/WD.(4) /11-12) GRANTED SUBSTANTIAL RELIEF TO THE ASSESSEE. AGGRIEVED BY TH E ORDER OF LD.CIT(A), REVENUE IS NOW IN APPEAL AND HAS RAISED THE FOLLOWI NG GROUNDS:- I) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.75,57,50,880/- MADE ON ACCOUNT OF UNDISCLOSED INCOME. II) THE LD.CIT(A) HAS ERRED IN LAW AND ON FACTS IN OBSERVING THAT THE ADDITION MADE U/S.68 OF THE INCOME TAX ACT WAS NOT PROPER SINCE THE SAID SECTION WAS APPLICABLE ONLY TO THE BORROWINGS WHICH FORMED PART OF BALANCE SHEET. THE CIT(A) HAS FURTHER ERRED IN OBS ERVING THAT THE HEAD NOTE OF THIS SECTION WAS CASH CREDITS WHICH WAS PART OF THE BALANCE SHEET AND THEREFORE, THE PROVISIONS OF THE SAID SEC TION WERE APPLICABLE TO THE BALANCE SHEET ENTRIES AND DID NOT COVER PROF IT AND LOSS ACCOUNT ENTRIES. III) THE CIT(A) HAS ERRED IN LAW AND ON FACTS IN A DMITTING ADDITIONAL EVIDENCES IN CONTRAVENTION OF RULE 46A AND OBSERVIN G THAT THE ASSESSEE HAD FULFILLED THE ONUS CAST UPON HIM OF PROVING THE IDENTITY OF SELLERS AND GENUINENESS OF THE TRANSACTIONS WHEN THE ASSESS EE HAD FAILED O FURNISH THE RELEVANT DOCUMENTS DURING THE COURSE OF ASSESSMENT PROCEEDINGS. ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 4 - IV) ON THE FACTS AND CIRCUMSTANCES OF THE CASE, TH E LD.COMMISSIONER OF INCOME TAX (A) OUGHT TO HAVE UPHELD THE ORDER OF TH E ASSESSING OFFICER. V) IT IS, THEREFORE, PRAYED THAT THE ORDER OF THE LD.COMMISSIONER OF INCOME TAX (A) MAY BE SET-ASIDE AND THAT OF THE ASS ESSING OFFICER BE RESTORED. 3. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT ASSESSEE WAS PROPRIETOR OF TWO CONCERNS NAMELY YAMU NA SYNTHETIC MILLS AND KIRAN FASHIONS AND WERE STATED TO BE ENGAGED IN THE TRADING OF COTTON GREY AND COTTON CLOTH AND DURING THE YEAR, ASSESSEE HAD SHOW AGGREGATE GROSS SALES OF RS.75.57 LACS IN HIS TWO PROPRIETARY -CONCERNS. HE ALSO NOTICED THAT ASSESSEE HAD MADE 95% OF THE PURCHASES FROM PRADEEP OVERSEAS LTD. TO VERIFY THE GENUINENESS OF PURCHAS E AND SALES, NOTICES WERE ISSUED U/S.133(6) OF THE INCOME TAX ACT, 1961 (HEREINAFTER REFERRED TO AS 'THE ACT') TO THE SUPPLIERS AS WELL AS THE CU STOMERS AND ASSESSEE WAS ALSO ASKED TO FURNISH LOT-WISE PURCHASE AND SALES D ETAILS. FROM THE DETAILS FURNISHED BY THE ASSESSEE, AO NOTICED THAT THE GOOD S THAT WERE STATED TO HAVE BEEN PURCHASED BY THE ASSESSEE WERE SOLD AFTER A GAP OF FEW DAYS WHICH ACCORDING TO THE AO MEANT THAT THE GOODS PURC HASED WOULD HAVE REMAINED IN THE CUSTODY OF THE ASSESSEE FOR SOME DA YS BEFORE BEING SOLD TO THE CUSTOMERS AND THEREFORE ACCORDING TO AO ASSE SSEE WOULD HAVE REQUIRED PLACE TO STORE THE GOODS STATED TO HAVE BE EN PURCHASED BY HIM. ON PERUSAL OF THE BALANCE-SHEET, AO ALSO NOTICED TH AT ASSESSEE HAD STOCK OF 509028.75 METERS OF CLOTH AS CLOSING STOCK AS ON 31/03/2009. HE ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 5 - FURTHER NOTICED THAT ASSESSEE DID NOT HAVE ANY GODO WN, TRUCKS OR CARRIAGE VEHICLE AS HIS FIXED ASSET NOR ASSESSEE PAID ANY RE NT FOR GODOWN. HE ALSO NOTICED THAT ASSESSEE HAD NOT DEBITED ANY SUBSTANTI AL AMOUNT FOR CARRIAGE AND TRANSPORTATION EXPENSES FOR GOODS FROM THE SUPP LIERS PREMISES TO HIS OWN PREMISES AND THEN TO THE PREMISES OF THE CUSTOM ERS. THE ASSESSEE WAS THEREFORE ASKED TO SUBSTANTIATE THE SALE AND PU RCHASE ALONGWITH DOCUMENTARY EVIDENCES AND EXPLAIN AS TO WHERE DID H E STORE THE GOODS TO WHICH ASSESSEE INTERALIA SUBMITTED THAT THE COST OF TRANSPORTATION OF PURCHASE AND SALES WERE BORNE BY THE SUPPLIERS AND CUSTOMERS RESPECTIVELY AND THAT HE SOLD THE GOODS ON LR BASIS . THE SUBMISSIONS OF THE ASSESSEE WERE NOT FOUND ACCEPTABLE TO THE AO. A O CALLED FOR CONFIRMATIONS FROM FEW CUSTOMERS BY ISSUING NOTICES U/S 133(6) OF THE ACT. AO HAS NOTED THAT THE ADDRESSES OF THE CUSTOME RS WERE THAT OF THE RESIDENTIAL PREMISES, THE CUSTOMERS WERE PROPRIETAR Y CONCERNS AND THAT ASSESSEE ALSO DID NOT FURNISH THE DETAILS OF THE DE LIVERY OF THE GOODS CLAIMED TO HAVE BEEN SOLD BY THE ASSESSEE. AO THERE FORE ON THE BASIS OF HIS OBSERVATIONS AND REPLY OF THE ASSESSEE, CONCLUD ED THAT THE GOODS PURPORTEDLY PURCHASED BY THE ASSESSEE NEVER CAME IN TO HIS POSSESSION AND THAT THE ASSESSEE HAS NOT DONE ANY TRADING BUSI NESS AND THAT THE AMOUNT CREDITED IN THE PROFIT & LOSS ACCOUNT IN THE GUISE OF SALES WAS NOTHING BUT UNACCOUNTED INCOME OF THE ASSESSEE. THE AO THEREFORE CONSIDERED THE ENTIRE AMOUNT OF SALES OF RS.75,57,5 0,088/- CREDITED BY THE ASSESSEE TO THE P&L ACCOUNT IN HIS TWO PROPRIET ARY-CONCERNS AS ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 6 - UNEXPLAINED INCOME U/S.68 OF THE ACT. AGGRIEVED BY THE ORDER, ASSESSEE CARRIED THE MATTER BEFORE THE LD.CIT(A), WHO DELED THE ADDITION BY HOLDING AS UNDER:- 2.7 I HAVE CAREFULLY CONSIDERED RIVAL SUBMISSIONS . 1 HAVE ALSO PERUSED VARIOUS EVIDENCES FURNISHED BY THE APPELLANT DURING THE APPELLATE PROCEEDINGS. I HAVE ALSO CONSIDERED VARIOUS CASE LA WS RELIED UPON BY THE APPELLANT AND THE A.O. THE FACTS OF THIS CASE AS CU LLED OUT FROM THE RECORDS ARE SUMMARIZED AS UNDER:- (I) THE APPELLANT HAS MADE PURCHASES AND SALES UNDER DE LIVERY THROUGH LR (LORRY RECEIPT), ISSUED BY SUPPLIER I.E. PRADIP OVERSEAS LTD. (POL) ALONG WITH PURCHASES INVOICE. (II) IN MOST OF CASES, APPELLANT HAS RECEIVED PURCHASE I NVOICE AND LR THROUGH BANKS, AS THE SUPPLIER HAS TAKEN FINANCE UN DER BILL-PURCHASE FACILITY ON SUCH SALES. (III) THE TRANSACTIONS OF SUCH TRADE (PURCHASE & S ALES) ARE COMPLETED, WHEN THE APPELLANT SOLD SUCH GOODS TO AN INTERMEDIA RY PARTY AND SUCH INTERMEDIARY PARTY SOLD GOODS FINALLY TO THE F IRST SELLER I.E. POL, THUS THE PURCHASES TO SALES TRANSACTIONS ARE C OMPLETED. (IV) SIMILARLY, THE PAYMENTS ARE REVERSELY MADE BY POL TO INTERMEDIARY PARTY, WHO IN-TURN MADE PAYMENTS TO APPELLANT AND A PPELLANT INSTRUCT THEIR BANKER TO REMIT PAYMENTS TO POL, THU S THE PAYMENTS FOR SALES TO PURCHASES TRANSACTIONS ARE COMPLETED. (V) IN ASSESSMENT PROCEEDINGS, THE APPELLANT HAD F ILED SAMPLE COPIES OF ALL EVIDENCES VIZ. PURCHASE BILL, BANK DOCUMENTS, S ALE INVOICES, ACCOUNT COPIES AND CONFIRMATIONS FROM SUPPLIERS AND BUYERS. ALL SUCH EVIDENCES FOR THE YEAR ARE FILED IN THE APPELL ATE PROCEEDINGS. (VI) THE ASSESSING OFFICER HAS ALSO CALLED FOR CON FIRMATIONS FROM SUPPLIERS AND BUYERS AND THE SUPPLIERS AND BUYERS H AD CONFIRMED THESE TRANSACTIONS. (VII) ALL THE PAYMENTS FOR PURCHASES AND SALES ARE THROUGH BANKING CHANNEL AND THE SALES PROCEEDS RECEIVED ARE IMMEDIA TELY PASS ON TO THE SUPPLIER OF GOODS I.E. POL. ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 7 - (VIII) THE ASSESSING OFFICER TREATED ENTIRE SALES PROCEEDS AS UNACCOUNTED INCOME OF THE APPELLANT ALLEGING THAT THE SAME IS P LOUGHED BACK IN THE BOOKS OF ACCOUNTS. HOWEVER, THE A.O. HAD NOT ID ENTIFIED THE ASSETS WHERE SUCH UNACCOUNTED INCOME WAS INVESTED. (IX) THE APPELLANT IN THE ASSESSMENT PROCEEDINGS A S WELL AS APPELLATE PROCEEDINGS BROUGHT ALL SUCH EVIDENCES ON RECORD TO PROVE THAT THE AMOUNTS RECEIVED IN BANK ACCOUNTS ARE SALE PROCEEDS . THE A.O. HAD NOT BROUGHT ANY EVIDENCE TO CONTROVERT THIS FACT. 2.8 IT IS SEEN THAT A.O. HAS MADE IMPUGNED ADDITION OF RS.75,57,50,880/- U/S.68 OF I.T. ACT. PROVISIONS OF SECTION 68 RELEVA NT FOR THIS APPEAL ARE DISCUSSED IN THE FOLLOWING PARAS. (I) IT IS HELD BY VARIOUS COURTS THAT SECTION 68 IS A S TATUTORY RECOGNITION OF WHAT WAS PREVIOUSLY ESTABLISHED BY T HE JURISDICTIONAL DECISIONS UNDER THE 1922 ACT TO THE EFFECT THAT WHERE CERTAIN SUMS OF MONEY WERE CLAIMED BY THE ASS ESSEE TO HAVE BEEN BORROWED FROM CERTAIN PERSONS, IT WAS FOR THE ASSESSEE TO PROVE BY COGENT AND PROPER EVIDENCES THAT THERE WERE GENUINE BORROWINGS AS THE FACTS ARE EXCLUSIVELY WITHIN THE ASSESSEE'S KNOWLEDGE. RELIANCE IN THIS REGARD IS PLACED ON SIK RI & CO.P.LTD. V/S. CIT (1977) 106 ITR 682 (CAL.), CIT V /S. KULWANT KAUR (1980) 121 ITR 914 (DEL), CIT V/S. SAHEBGANJ E LECTRIC CABLES P.LTD. 115 ITR 408 (CAL.). THE RATIO OF ABOV E CASES REVEALS THAT PROVISIONS OF SECTION 68 ARE APPLICABL E TO THE BORROWINGS ONLY, WHICH FORMS PART OF BALANCE SHEET. THE HEAD NOTE OF THIS SECTION IS ('CASH CREDITS'). CASH CREDITS ARE ALSO PART OF BALANCE SHEET. ACCORDINGLY, I AM OF THE CON SIDERED VIEW THAT PROVISIONS OF SECTION 68 ARE APPLICABLE TO THE BALANCE SHEET ENTRIES AND IT DOES NOT COVER PROFIT AND LOSS ACCOU NT ENTRIES. (II) IT IS A MATTER OF FACT THAT APPELLANT HAS DECLARED SALES OF RS.75,57,50,880/- IN ITS PROFIT AND LOSS ACCOUNT. T HUS, THE SALES HAS ALREADY BEEN DECLARED AS INCOME BY THE APPELLAN T IN ITS PROFIT AND LOSS ACCOUNT. THE A.O. HAS MADE AN ADDITION OF RS.75,57,50,880/- AGAINST THESE SALES U/S.68 OF IT. ACT. THIS WAY, ADDITION OF RS.75,57,50,880/- TANTAMOUNTS TO DOUBLE ADDITION AND ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 8 - THE SAME IS NOT AS PER THE PROVISIONS OF IT. ACT. R ELIANCE IN THIS REGARD IS PLACED ON THE DECISION OF AMBICA STEELS L TD. V/S. DCIT (2009) 118 ITD116(DEL.) (III) IT IS SEEN THAT THESE TRANSACTIONS ARE CIRCULATORY TRANSACTIONS. THIS FACT HAS BEEN HIGHLIGHTED BY THE A.O. IN THE A SSESSMENT ORDER AND THIS FACT IS ALSO ACCEPTED BY THE APPELLA NT IN HIS SUBMISSIONS. IT IS RIGHTLY OBSERVED BY THE A.O. AN D ADMITTED BY THE APPELLANT THAT APPELLANT HAS PURCHASED GOODS FR OM PRADIP OVERSEAS LTD. (POL) AND SOLD THE GOODS TO A BUYER A S INFORMED BY POL. THE GOODS WERE FINALLY SOLD TO POL. THE PAY MENTS HAVE TRAVELLED IN THE REVERSE DIRECTION. THIS WAY, THESE PURCHASES AND PAYMENTS HAVE FINALLY LANDED WITH POL. THE CIRCULAT ORY TRANSACTIONS HAS BEEN CONSIDERED BY HON'BLE MUMBAI ITAT IN THE CASE OF KASHUKHA TRADING & SERVICES P.LTD. V/S. ITO (2008) 26 SOT 388. IN THIS CASE, IT IS HELD BY HON'BLE ITA T THAT SUCH CIRCULATORY TRANSACTIONS ARE IN ACCORDANCE WITH COM MERCIAL EXPEDIENCIES. IT CANNOT BE RULED OUT THAT SUCH CIRC ULATION TRANSACTIONS WERE NOT FOR THE PURPOSE OF BUSINESS O F THE ASSESSEE. SOMETIME THE ASSESSEE HAS TO SATISFY CERTAIN REQUIR EMENTS OF THE BUSINESS IN THE FORM OF HIGHER TURNOVER FOR GETTING FINANCE OR OTHER BUSINESS PURPOSES. THIS WAY, HON'BLE ITAT HAS APPROVED THE FACT OF CIRCULATORY TRANSACTIONS AS BUSINESS EX PEDIENCY. (IV) IT IS A TRITE LAW THAT ASSESSEE HAS TO PROVE P RIMA FACIE THE TRANSACTIONS WHICH RESULTS IN A CASH CREDIT IN HIS BOOKS OF ACCOUNTS. SUCH PROOF INCLUDES PROOF OF IDENTITY OF HIS CREDITOR, THE CAPACITY OF SUCH CREDITOR TO ADVANCE THE MONEY AND THE GENUINENESS OF THE TRANSACTIONS. IF THESE CONDITION S ARE PROVED PRIMA FACIE THEN IT CAN BE SPECIFICALLY SAID THAT A SSESSEE HAD DISCHARGED ITS ONUS CAST UPON HIM BY THE PROVISIONS OF SECTION 68 OF IT. ACT. RELIANCE IN THIS REGARD IS PLACED ON CI T V/S. PRECISION FINANCE LTD. (1994) 208 ITR 465 (CAL.). 2.9 THIS APPEAL IS TO BE DECIDED WITHIN THE FACTUAL AN D LEGAL MATRIX AS MENTIONED ABOVE. THE FACTS AVAILABLE ON RECORD CLEA RLY PROVES THAT DURING THE ASSESSMENT PROCEEDINGS, ASSESSEE WAS REQUIRED T O PROVE FACTUM OF ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 9 - SALES/PURCHASES. IN THIS REGARD, APPELLANT HAS FURN ISHED DETAILS OF PURCHASES/SALES BILLS, PARTICULARS OF SELLERS AND B UYERS, PARTICULARS OF L.RS. AND SALES/PURCHASE AMOUNT. NOT ONLY THIS, THESE BIL LS WERE DISCOUNTED WITH BANKERS UNDER BILLS PURCHASE FACILITIES. THESE DOCU MENTS WERE ROUTED THROUGH BANK AND THE BANKERS HAD DULY ACKNOWLEDGED THESE FACTS. THESE FACTS HAD BEEN ACCEPTED BY THE A.O. ALSO. THE A.O. HAD ALSO MADE INDEPENDENT INQUIRIES FROM PURCHASERS/SELLERS AND T HESE PARTIES HAD DULY ACKNOWLEDGED THE TRANSACTIONS OF SALES/PURCHASES UN DERTAKEN BY THEM WITH THE APPELLANT. THIS WAY, FACT OF SALES/PURCHASES TR ANSACTIONS UNDERTAKEN BY THE APPELLANT IS DULY CONFIRMED. THE A.O. HAS FURTH ER OBSERVED THAT ASSESSEE FAILED TO FURNISH COPY OF L.R. WHICH IT MI GHT HAVE RECEIVED EITHER DIRECTLY OR FROM THE ALLEGED SUPPLIER OR THROUGH BA NKER. IN THE NEXT LINE, THE A.O. HAD ALSO OBSERVED THAT IN THE DOCUMENT ARR IVAL NOTICE RECEIVED FROM APPELLANT'S BANK, PARTICULARS OF L.R. ARE MENT IONED. 1 HAVE ALSO PERUSED DOCUMENT ARRIVAL NOTICE, WHERE PARTICULARS OF L.R. ARE NEATLY RECORDED IN THESE DOCUMENTS. THIS WAY, 1 AM OF THE CONSIDERED VIEW THAT A.O. WAS HAVING SUFFICIENT EVIDENCES BEFORE HIM TO ESTABLISH EXISTENCE OF L.R. AND THE FACTS AVAILABLE ON RECORD CONCLUSIVELY PROVES THE SALE/PURCHASE TRANSACTIONS OF THE APPELLANT. IN VIE W OF ABOVE, I HOLD THAT THE A.O. HAD MADE AN ISSUE OF NON PRODUCTION OF L.R . FOR MAKING IMPUGNED ADDITION. HAD THE A.O. FELT THE NEED OF SUCH L.RS. FOR THE PURPOSE OF MAKING ASSESSMENT, HE COULD HAVE SUMMONED THE SAME FROM SUPPLIERS OR BANKING AUTHORITIES. IN VIEW OF THE ABOVE FACTS, I AM NOT INCLINED TO AGREE WITH THE A.O. ON EMPHASIZING THIS FACT AND MAKING T HE IMPUGNED ASSESSMENT. 2.10 THE A.O. HAS ALSO OBSERVED THAT APPELLANT HAS NOT C ONDUCTED SALES/PURCHASE TRANSACTIONS AS GOODS WERE NEVER REC EIVED BY IT. ACCORDINGLY, THE A.O. HAD TREATED SALES AMOUNTS REC EIVED BY THE APPELLANT AS INCOME FROM OTHER SOURCES. I AM NOT INCLINED TO AGREE WITH THE A.O.'S FINDING ON THIS ISSUE. IN MY CONSIDERED VIEW FOR EF FECTING SALES ONE NEED NOT NECESSARY TO TAKE POSSESSION OF THE GOODS INTENDED TO BE SOLD. THE ENTIRE GREY CLOTH TRADING IN SURAT AND AHMEDABAD IS BEING CONDUCTED WITHOUT TAKING POSSESSION OF THE GOODS. THESE GOODS ARE GEN ERALLY TRANSFERRED FROM THE GODOWN OF THE THIRD PARTY TO THE BUSINESS PLACE OF INTENDING BUYER. OTHER INSTANCE, WHERE THE GOODS ARE BEING SOLD WITH OUT TAKING POSSESSION ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 10 - IS HIGH SEA SALES. IN VIEW OF THESE FACTS, I AM NOT INCLINED TO AGREE WITH THE CONTENTIONS OF THE ID.A.O. 2.11 IT IS SEEN THAT THE A.O. HAS MADE IMPUGNED ADDITION U/S.68 OF IT. ACT. IN MY CONSIDERED VIEW, THE IMPUGNED ADDITION CANNOT BE MADE U/S.68 OF IT. ACT FOR THE FOLLOWING REASONS: (A) THE APPELLANT HAS DECLARED SALES OF RS. 75,57, 50,880/- IN ITS PROFIT AND LOSS ACCOUNT. BY MAKING ADDITION OF RS.7 5,57,50,880/- U/S.68 OF I.T. ACT WILL TANTAMOUNT TO DOUBLE ADDITI ON WHICH IS NOT PERMITTED UNDER THE PROVISIONS OF IT. ACT. (B) AS DISCUSSED ABOVE, PROVISIONS OF SECTION 68 ARE APPLICABLE TO THE CASH CREDITS REFLECTED IN THE BALANCE SHEET. TH ESE PROVISIONS ARE NOT APPLICABLE IN THE CASE OF CREDIT ENTRIES RE FLECTED IN THE PROFIT AND LOSS ACCOUNT. SINCE APPELLANT HAS DECLAR ED RECEIPT OF RS.75,57,50,880/- AS SALES IN ITS PROFIT AND LOSS A CCOUNT, ACCORDINGLY PROVISIONS OF SECTION 68 WILL NOT BE AT TRACTED AGAINST IMPUGNED RECEIPTS. (C) IT IS AN ESTABLISHED FACT THAT SALES CONSIDER ATION OF RS.75,57,50,880/- HAD BEEN RECEIVED THROUGH BANKING CHANNELS. THE PERSONS FROM WHOM SALES CONSIDERATION HAS BEEN RECEIVED, HAS CONFIRMED THE FACTS OF PAYMENTS. THE A.O. COULD NOT BRING ANY MATERIAL ON RECORD TO INDICATE THAT APPELLANT H AS FAILED TO DISCHARGE ONUS CAST UPON HIM U/S.68 OF L.T. ACT WHI CH INCLUDES IDENTITY OF THE CREDITOR, GENUINENESS OF THE TRANSA CTIONS AND CREDITWORTHINESS OF THE CREDITORS. IN THIS CASE, AP PELLANT HAS FURNISHED SUFFICIENT DETAILS TO ESTABLISH IDENTIFY OF THE SELLERS, GENUINENESS OF THE TRANSACTIONS AND THE SO CALLED C APACITY TO MAKE THESE PAYMENTS. IN VIEW OF ABOVE, ON THIS ACCO UNT ALSO, ADDITION U/S.68 OF L.T. ACT CANNOT BE MADE IN THE C ASE OF APPELLANT. (D) THE A.O. HAD ALSO PLACED RELIANCE ON FEW CASE S. THE RATIO OF THESE CASES CANNOT BE APPLIED THIS CASE, AS THESE C ASES WERE DECIDED ON ENTIRELY DIFFERENT FACTS. THESE CASES AR E ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 11 - DISTINGUISHABLE AND THE DISTINGUISHING FEATURES ARE GIVEN ON PAGES 27 & 28 OF THIS ORDER. 2.12 IN VIEW OF ABOVE, I HOLD THAT IMPUGNED ADDITIO N OF RS.75,57,50,880/- IS UNTENABLE FACTUALLY AS WELL AS LEGALLY-ACCORDINGLY, ADDITION OF RS.75,57,50,880/- MADE BY THE A.O. U/S. 68 OF L.T. ACT IS ORDERED TO BE DELETED. THIS GROUND OF APPEAL IS ALL OWED. 3.1. AGGRIEVED BY THE ORDER OF LD.CIT(A), REVENUE I S NOW IN APPEAL BEFORE US. 3.2. BEFORE US, LD.DR TOOK US THROUGH THE VARIOUS OBSERVATIONS OF AO AND SUBMITTED THAT BEFORE THE AO, ASSESSEE DID NOT FURNISH ANY INFORMATION THAT WAS CALLED FOR BY THE AO. ASSESSEE HOWEVER SUBMITTED THE ADDITIONAL EVIDENCES IN THE FORM OF LRS (LORRY RECEIPTS) AND VARIOUS OTHER EVIDENCES BEFORE THE LD.CIT(A). HE SUBMITTED THAT THE LD.CIT(A) WITHOUT CALLING FOR ANY REMAND REPORT, ADMITTED ADD ITIONAL EVIDENCES AND DECIDED THE ISSUE IN FAVOUR OF ASSESSEE. HE POI NTED TO THE SUBMISSIONS MADE BY THE ASSESSEE BEFORE CIT(A) AND WHICH HAVE BEEN REPRODUCED BY CIT(A) IN HIS ORDER AND FROM THOSE AS SESSEES SUBMISSIONS AND MORE SPECIFICALLY HE DREW OUR ATTENTION TOWARD S POINT NO.6 AT PAGE 23 AND PAGE NO 11 13 OF THE ORDER AND SUBMITTED THA T THESE DETAILS WERE NOT PRODUCED BEFORE AO. HE THEREFORE SUBMITTED THAT LD.CIT(A) HAS ERRED IN ADMITTING ADDITIONAL EVIDENCES AND BY NOT ALLOWI NG THE AO TO CONFRONT THE ADDITIONAL EVIDENCES NOR OBTAINING ANY REMAND R EPORT FROM THE AO WAS IS IN VIOLATION OF PRINCIPLES OF NATURAL JUSTIC E AND RULE 46A OF THE IT ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 12 - RULES, 1962 AND IN SUPPORT OF HIS CONTENTION OF VIO LATION OF PROVISIONS OF RULE 46A, HE PLACED RELIANCE ON THE DECISION(S) IN THE CASE OF HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. MANISH BUIL D WELL (P) LTD. REPORTED IN (2011) 245 CTR 397 (DELHI) AND OF HONB LE GAUHATI HIGH COURT IN THE CASE OF CIT VS. RANJIT KUMAR CHOUDHURY REPORTED IN (2007) 288 ITR 179 (GAU). HE THEREFORE SUBMITTED THAT THE ORDER OF AO NEEDS TO BE UPHELD. IN THE ALTERNATE, HE SUBMITTED THAT THE MATTER MAY BE REMITTED BACK TO THE FILE OF LD.CIT(A) TO DECIDE THE ISSUE A FRESH AFTER COMPLYING WITH THE PROVISIONS OF RULE 46A OF THE IT RULES, 19 62. THE LD.AR, ON THE OTHER HAND, REITERATED THE SUBMISSIONS MADE BEFORE THE AO AND LD.CIT(A) AND SUPPORTED THE ORDER OF THE LD.CIT(A) AND SUBMIT TED THAT NO SUO MOTU ADDITIONAL EVIDENCES WERE SUBMITTED BY THE ASSESSEE . HE FURTHER SUBMITTED THAT THE LD.CIT(A) IS EMPOWERED TO CALL F OR SUCH OTHER EVIDENCES AS REQUIRED TO DECIDE THE CASE AND THAT T HERE IS NO VIOLATION OF RULE 46A OF THE IT RULES. HE ALSO PLACED ON RECORD THE COPY OF THE AFFIDAVIT DATED 15/06/2016, WHEREIN INTER-ALIA IT IS SUBMITTED THAT ASSESSEE HAD FILED NECESSARY DETAILS BEFORE THE AO. 4. WE HAVE HEARD THE RIVAL SUBMISSIONS, PERUSED THE MATERIAL AVAILABLE ON RECORD AND GONE THROUGH THE ORDERS OF THE AUTHORITIES BELOW. IN THE PRESENT CASE, THE ISSUE IS WITH RESPECT TO A DDITION MADE U/S 68 OF THE ACT BY THE AO WHICH WERE DELETED BY LD CIT(A). BEFORE US, ONE OF THE CONTENTION RAISED BY THE REVENUE IS VIOLATION O F PROVISIONS OF RULE ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 13 - 46A OF THE INCOME TAX RULES. AT THIS MOMENT IT WOUL D BE RELEVANT TO REFER TO PROVISIONS OF RULE 46A WHICH READS AS UNDE R: PRODUCTION OF ADDITIONAL EVIDENCE BEFORE THE [DEPUT Y COMMISSIONER (APPEALS)] [AND COMMISSIONER (APPEALS)]. (1) THE APPELLANT SHALL NOT BE ENTITLED TO PRODUCE BEFORE THE [DEPUTY COMMISSIONER (APPEALS)] [OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS) ], ANY EVIDENCE, WHETHER ORAL OR DOCUMENTARY, OTHER THAN THE EVIDENC E PRODUCED BY HIM DURING THE COURSE OF PROCEEDINGS BEFORE THE [ASSESSING OFFICER], EXCEPT IN THE FOLLOWING CIRCUMSTANCES, NAMELY: (A) WHERE THE [ASSESSING OFFICER] HAS REFUSED TO ADMIT EVIDENCE W HICH OUGHT TO HAVE BEEN ADMITTED; OR (B) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING THE EVIDENCE WHICH HE WAS CALLED UPON TO PRODUCE BY THE [ASSESSING OFFICER]; OR (C) WHERE THE APPELLANT WAS PREVENTED BY SUFFICIENT CAUSE FROM PRODUCING BEFORE THE [ASSESSING OFFICER] ANY EVIDENCE WHICH IS RELEVANT TO ANY GROUND OF APPEAL; OR (D) WHERE THE [ASSESSING OFFICER] HAS MADE THE ORDE R APPEALED AGAINST WITHOUT GIVING SUFFICIENT OPPORTUNITY TO THE APPELLANT TO ADDUCE E VIDENCE RELEVANT TO ANY GROUND OF APPEAL. (2) NO EVIDENCE SHALL BE ADMITTED UNDER SUB-RULE (1 ) UNLESS THE [DEPUTY COMMISSIONER (APPEALS)] [OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS) ] RECORDS IN WRITING THE REASONS FOR ITS ADMISSION. (3) THE [DEPUTY COMMISSIONER (APPEALS)] [OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS)] SHALL NOT TAKE INTO ACCOUNT ANY EVIDENCE PRODUCED UNDER SUB-RULE (1) UNLESS THE [ASSESSING OFFICER] HAS BEEN ALLOWED A REASONABLE OPPORTUNITY (A) TO EXAMINE THE EVIDENCE OR DOCUMENT OR TO CROSS -EXAMINE THE WITNESS PRODUCED BY THE APPELLANT; OR ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 14 - (B) TO PRODUCE ANY EVIDENCE OR DOCUMENT OR ANY WITN ESS IN REBUTTAL OF THE ADDITIONAL EVIDENCE PRODUCED BY THE APPELLANT. (4) NOTHING CONTAINED IN THIS RULE SHALL AFFECT THE POWER OF THE [DEPUTY COMMISSIONER (APPEALS)] [OR, AS THE CASE MAY BE, THE COMMISSIONER (APPEALS) ] TO DIRECT THE PRODUCTION OF ANY DOCUMENT, OR THE EXAMINATION OF A NY WITNESS, TO ENABLE HIM TO DISPOSE OF THE APPEAL, OR FOR ANY OTHER SUBSTANTIAL CAUSE INCLUDING THE ENHANCEMENT OF THE ASSESSMENT OR PENALTY (WHETHER ON HIS OWN MO TION OR ON THE REQUEST OF THE [ASSESSING OFFICER]) UNDER CLAUSE (A) OF SUB-SECTIO N (1) OF SECTION 251 OR THE IMPOSITION OF PENALTY UNDER SECTION 271. 5. A BARE PERUSAL OF THIS RULE INDICATE THAT THE ASSESSEE (BECAUSE IN THE SCHEME OF THE ACT, NO APPEAL IS BEING PROVIDED AT T HE END OF REVENUE AGAINST THE ASSESSMENT ORDER BEFORE CIT(A)] SHALL N OT BE ENTITLED TO PRODUCE ANY EVIDENCE BEFORE THE FIRST APPELLATE AUT HORITY EITHER ORAL OR DOCUMENTARY UNLESS THE CONDITIONS ENUMERATED IN CLA USE (A) TO (D) OF SUB RULE EXISTS. UNDER CLAUSE (A) IT HAS BEEN PROVIDED THAT THE ASSESSEE CAN BE PERMITTED TO PRODUCE ADDITIONAL EVIDENCE WHICH OUGH T TO HAVE BEEN ADMITTED BY THE AO, BUT HE REFUSED TO ADMIT. CLAUSE (B) PROVIDES THAT WHERE THE ASSESSEE WAS PREVENTED BY SUFFICIENT CAUS E FROM PRODUCING THE EVIDENCE WHICH WAS CALLED UPON TO PRODUCE BY THE AO , CLAUSE (C) AND (D) PROVIDE THAT IF THE ASSESSEE WAS PREVENTED BY SUFFI CIENT CAUSE FROM PRODUCING ANY EVIDENCE WHICH IS RELEVANT TO ANY GRO UND OF APPEAL OR THE AO HAS MADE THE ORDER APPEALED AGAINST WITHOUT GIVI NG SUFFICIENT OPPORTUNITY TO THE ASSESSEE TO ADDUCE EVIDENCE RELE VANT TO ANY GROUND OF APPEAL, THEN CIT(A) WOULD ADMIT ADDITIONAL EVIDENCE . THE NEXT REQUIREMENT TO BE FOLLOWED BY THE LD FIRST APPELLAT E AUTHORITY IS THAT THE ADMISSION OF ADDITIONAL EVIDENCE ON THE RECORD IS B Y WAY OF AN ORDER IN ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 15 - WRITING ALONGWITH THE REASONS FOR ITS ADMISSION. ON CE THE EVIDENCE IS BEING ADMITTED THAN AN OPPORTUNITY TO THE AO WOULD BE GRANTED TO REBUT THAT EVIDENCE AS CONTEMPLATED IN SUB RULE 3. SUB RU LE 4 IS AN EXPLANATION TO ALL THESE SITUATIONS, THE LD COMMISSIONER FOR TH E JUST DECISION OF AN APPEAL CAN DIRECT ANY PARTY TO SUBMIT ANY EVIDENCE THAT IS EITHER TO THE ASSESSEE OR TO THE AO. THE COMMENTS OF THE AO IN TH AT CASE WOULD NOT BE REQUIRED TO BE CALLED FOR. PERUSAL OF SUB RULE 3 IN DICATE THAT THE CIT(A) SHALL NOT TAKE INTO ACCOUNT ANY FRESH EVIDENCE FILE D BY THE ASSESSEE BEFORE HIM UNLESS THE AO HAS BEEN ALLOWED A REASON ABLE OPPORTUNITY TO EXAMINE SUCH EVIDENCE OR DOCUMENTS ETC FILED BY THE ASSESSEE OR TO PRODUCE ANY EVIDENCE OR DOCUMENT ETC IN REBUTTAL OF SUCH ADDITIONAL EVIDENCE PRODUCED BY THE ASSESSEE. THUS IT IS DIVUL GED THAT UNLESS THE AO IS ALLOWED A REASONABLE OPPORTUNITY TO DO THIS, T HE CIT(A) CANNOT TAKE INTO ACCOUNT SUCH ADDITIONAL EVIDENCE PRODUCED BY T HE ASSESSEE BEFORE HIM. THE EXPRESSION A REASONABLE OPPORTUNITY, AS HELD BY VARIOUS AUTHORITIES, WOULD MEAN AN EFFECTIVE OPPORTUNITY AN D NOT A MERE EYE WASH. 5.1. WE FIND THAT GAUHATI HIGH COURT IN THE CASE OF CIT VS. RANJIT KUMAR CHOUDHURY REPORTED IN (2007) 288 ITR 179 (GAU ) HAS HELD AS UNDER:- PROVISION OF R. 46A(1) CLEARLY BARS THE PRODUCTION OF ANY ADDITIONAL EVIDENCE. IT WOULD GO TO SHOW THAT THE PRODUCTION O F ADDITIONAL EVIDENCE IS NOT ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 16 - A MATTER OF RIGHT. HOWEVER, IN EXCEPTIONAL CASES, O N THE BASIS OF ANY ONE OF THE GROUNDS WHICH HAVE BEEN MANIFESTLY AND APPARENTLY S ET OUT IN R. 46A(1) ITSELF, THE APPELLANT IS PERMITTED TO PRODUCE ADDITIONAL EV IDENCE SUBJECT TO APPROVAL/ ADMISSION OF THE SAME BY THE APPELLATE AUTHORITY. T HIS PROVISION ENUMERATES FOUR CIRCUMSTANCES ALLOWING THE APPELLANT/ASSESSEE TO PRODUCE ADDITIONAL EVIDENCE. THE PROCEDURE OF R. 46A(1) AS REGARDS THE PRODUCTION OF ADDITIONAL EVIDENCE NEEDS TO BE GUIDED AND CONTROLLED BY SUB-R R. (2) AND (3) OF R. 46A. IN OTHER WORDS, IF ADDITIONAL EVIDENCE IS PERMITTED TO BE PRODUCED, THEN FIRSTLY THERE MUST BE REASONS TO BE RECORDED IN WRITING AND SECONDLY REASONABLE OPPORTUNITY HAS TO BE GIVEN TO THE ASSESSING AUTHOR ITY TO REFUTE AND REJECT SUCH PRODUCTION. SUB-R. (4) OF R. 46A WOULD GO TO SHOW T HAT THIS POWER CAN BE EXERCISED BY THE CIT(A) SUO MOTU WHEN THERE IS NO S UCH AVAILABLE DOCUMENTS PLACED BEFORE THE APPELLATE AUTHORITY FOR PURPOSEFU L AND EFFECTIVE ADJUDICATION OF THE APPEAL. ON THAT OCCASION ONLY BY EXERCISING THE POWER BESTOWED UPON HIM BY SUB-R. (4) OF R. 46A R/W S. 250(4) WHICH EMP OWERS HIM TO MAKE FURTHER INQUIRY AS HE THINKS FIT, THE CIT(A) SHALL DIRECT F OR PRODUCTION OF ANY DOCUMENT OR EXAMINATION OF ANY WITNESS, TO ENABLE HIM TO DIS POSE OF THE APPEAL OR FOR ANY OTHER SUBSTANTIAL CAUSE INCLUDING THE ENHANCEME NT OF THE ASSESSMENT OR PENALTY. 5.2. WE ALSO FIND THAT THE HONBLE DELHI HIGH COURT IN THE CASE OF CIT VS. MANISH BUILD WELL (P) LTD. REPORTED IN (2011) 2 45 CTR 397 (DELHI) HAS HELD AS UNDER:- SO FAR AS THE METHOD OF ACCOUNTING IS CONCERNED, T HE CIT(A) HELD THAT THE PROJECT COMPLETION METHOD IS A WELL RECOGNIZED AND ACCEPTED METHOD OF ACCOUNTING AND WAS THE ONLY METHOD SUITABLE FOR ANY DEVELOPER WHO HAS TO DELIVER A COMPLETED PRODUCT TO THE BUYER. THE AFORE SAID FINDING OF THE CIT(A) WAS APPROVED BY THE TRIBUNAL WITH THE OBSERVATION T HAT THE DEPARTMENT HAS ACCEPTED THE ASSESSEES METHOD OF ACCOUNTING NAMELY , THE PROJECT COMPLETION METHOD AND THEREFORE THERE WAS NO JUSTIFICATION FOR ADOPTING THE PERCENTAGE COMPLETION METHOD FOR ONE YEAR ON SELECTIVE BASIS. IT IS WELL-SETTLED THAT THE PROJECT COMPLETION METHOD IS ONE OF THE RECOGNIZED METHODS OF ACCOUNTING. IT CANNOT BE SAID THAT THE PROJECT COMPLETION METHOD F OLLOWED BY THE ASSESSEE WOULD RESULT IN DEFERMENT OF THE PAYMENT OF THE TAX ES WHICH ARE TO BE ASSESSED ANNUALLY UNDER THE IT ACT. AS-7 ISSUED BY THE ICAI ALSO RECOGNIZES THE POSITION THAT IN THE CASE OF CONSTRUCTION CONTRACTS , THE ASSESSEE CAN FOLLOW EITHER THE PROJECT COMPLETION METHOD OR THE PERCENT AGE COMPLETION METHOD. ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 17 - THE FINDING OF THE CIT(A), UPHELD BY THE TRIBUNAL, DOES NOT GIVE RISE TO ANY SUBSTANTIAL QUESTION OF LAW. FURTHER, THE TRIBUNAL HAS ALSO FOUND THAT THERE WAS NO JUSTIFICATION ON THE PART OF THE AO TO ADOPT THE PERCENTAGE COMPLETION METHOD FOR ONE YEAR (THE YEAR UNDER APPEAL) ON SELE CTIVE BASIS. THIS WILL DISTORT THE COMPUTATION OF THE TRUE PROFITS AND GAI NS OF THE BUSINESS. FOR THESE REASONS, NO SUBSTANTIAL QUESTION OF LAW ARISES.CIT VS. HYUNDAI HEAVY INDUSTRIES CO. LTD. (2007) 210 CTR (SC) 178 : (2007 ) 291 ITR 482 (SC) AND CIT VS. BILAHARI INVESTMENT (P) LTD. (2008) 215 CTR (SC) 201 : (2008) 3 DTR (SC) 329 : (2008) 299 ITR 1 (SC) RELIED ON; DY. CIT VS. MANISH BUILDWELL (P) LTD. (2011) 63 DTR (DEL)(TRIB) 448 AFFIRMED. 5.3. BEFORE US, LD AR HAS FILED AN AFFIDAVIT OF T HE ASSESSEE, WHICH READS AS UNDER:- AFFIDAVIT RAHUL SABOO S/O. ALAKHNIRANJAN SABOO, (PROP. YAMUNA SYNTHETIC MILLS AND KIRAN FASHIONS)( HINDU-ADULT, RESIDING AT 105, RAJDHANI BUNGALOWS, R AMWADI, ISANPUR, AHMEDABAD, DO HEREBY DECLARE ON SOLEMN AFFIRMATION: 1. THAT I AM ENGAGED IN BUSINESS OF TRADING OF GREY AN D PRINTED FABRICS IN THE PROPRIETARY CONCERNS M/S.YAMUNA SYNTHETICS MILLS AND M/S.KIRAN FASHIONS. 2. THAT THE MOST OF TRADING BUSINESS CONSIST OF BILL T RADING ON LORRY RECEIPTS (LR), WHERE THE GOODS ARE RECEIVED THROUGH BANK-BILTY AND SOLD OUT ON HANDING OVER OF LR, THEREFORE, THE LR WAS NOT AVAILABLE AT THE TIME OF ASSESSMENT PROCEEDINGS. 3. THAT IN ASSESSMENT PROCEEDINGS BEFORE AO, I HAVE SU BMITTED COMPLETE DETAILS OF PURCHASE AND SALE PARTIES ALONG WITH INVOICES AND D OCUMENT ARRIVAL NOTICE FROM BANKS. PURCHASE INVOICES CONTAIN DETAILS OF LORRY RECEIPT AND DOCUMENT ARRIVAL NOTICE ISSUED BY BANKS CONTAIN DETAILS OF PURCHASE BILL, LORRY RECEI PT, TRANSPORTER DETAILS, ETC. 4. THAT IN THE APPELLANT PROCEEDINGS BEFORE LD.CIT(A)- XI, AHMEDABAD, VIDE WRITTEN SUBMISSION DATED 08-05-2012, SUBMITTED FACTS OF THE CASE, NATURE OF BUSINESS AND PAPER BOOK CONTAINING WRITTEN SUBMISSION AND EVIDENCES SU BMITTED BEFORE AO. 5. THAT DURING THE COURSE OF APPELLATE HEARING, LD.CIT (A), REQUIRED ME TO SUBMIT LORRY RECEIPTS ISSUED BY SUPPLIER. 6. THAT BEFORE LD.CIT(A), VIDE WRITTEN SUBMISSION DATE D 05-06-2012, ANALYSIS CHART OF PURCHASE AND SALE CONTAINING DETAILS OF PURCHASE IN VOICES, LORRY RECEIPTS, BANK REFERENCE LETTER NO AND SALES INVOICES WERE FURNISHED. 7. THAT DURING THE APPELLANT PROCEEDING ON 05-06-2016, LD.CIT(A) REQUIRED ME TO GIVE SUBMISSION ON ADDITIONAL EVIDENCES I.E. ON LORRY RE CEIPTS. 8. THAT BEFORE LD.CIT(A), VIDE WRITTEN SUBMISSION DATE D 07-06-2012, IT WAS SUBMITTED THAT PURCHASE INVOICES AND BANK REFERENCE LETTER CONTAIN S DETAILS OF LR. FURNISHING COPIES OF LR BEFORE LD.CIT(A) ARE MERELY PROCEDURE, AS LR NUM BERS ARE MENTIONED ON ALL PURCHASE BILLS, WHICH ARE PART OF PROCEEDINGS BEFOR E AO. 9. THAT THE LD.CIT(A) HAS MENTIONED THAT THERE WAS REF ERENCE OF LR OF ASSESSMENT PROCEEDINGS IN PARA NO 2.9 OF APPELLATE ORDER. ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 18 - WHATSOEVER STATED ABOVE IN PARA NO.1 TO PARA NO.9 I S TRUE AND CORRECT TO THE BEST OF MY KNOWLEDGE AND BELIEF. PLACE : AHMEDABAD SD/- DATE : 15-06-2016 RAHOOL A. SABOO 5.4. IN THE PRESENT CASE, WE FIND THAT THE LD.CI T(A) HAS NOT CALLED FOR ANY REMAND REPORT FROM THE AO. BEFORE US, ASSESSEE HAS FILED AFORESAID AFFIDAVIT. THE AFFIDAVIT THAT HAS BEEN FILED BY THE ASSESSEE WAS NOT AVAILABLE BEFORE THE LOWER AUTHORITIES. IN CLAUSE( 2) OF THE AFFIDAVIT, ASSESSEE HAS STATED THAT THE LRS WERE NOT AVAILABLE AT THE TIME OF ASSESSMENT PROCEEDINGS AND IN CLAUSE (5) & (7) IT I S STATED THAT DURING THE COURSE OF APPELLATE PROCEEDINGS ASSESSEE WAS ASKED TO PRODUCE LRS AS ADDITIONAL EVIDENCES. IT IS REVENUES CONTENTION TH AT THE ASSESSEE HAS FILED ADDITIONAL EVIDENCES, WHEREAS IT IS ASSESSEE S CONTENTION THAT NO ADDITIONAL EVIDENCES HAVE BEEN FILED BY ASSESSEE. I N VIEW OF THE CONTRARY SUBMISSIONS BY BOTH THE PARTIES, WE ARE OF THE VIEW THAT THE AVERMENTS MADE BY THE ASSESSEE NEEDS VERIFICATION AT THE END OF CIT(A) AND A CATEGORICAL FINDING ON THE SAME. F URTHER IN VIEW OF THE PROVISIONS OF THE ACT, THE DECISIONS CITED HEREINABOVE AND IN THE IN TEREST OF JUSTICE WE ARE OF VIEW THAT THE ISSUE OF ADDITION MADE BY THE AO NEEDS TO BE SET ASIDE TO THE FILE OF LD.CIT(A) FOR HIM TO REDECIDE THE IS SUE AFTER COMPLYING WITH THE REQUIREMENTS OF RULE 46A OF THE IT RULES, 1962 AND IN ACCORDANCE WITH LAW AND THEREFORE WE, WITHOUT DECIDING THE I SSUE ON MERITS, RESTORE ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 19 - THE ISSUE BACK TO THE FILE OF L.DCIT(A). THUS, T HIS GROUND OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSES. 6. IN THE RESULT, REVENUES APPEAL IN ITA NO.1922/A HD/2012 FOR AY 2009-10 IN THE CASE OF SHRI RAHUL A.SABOO IS ALLOWE D FOR STATISTICAL PURPOSES. 7. IN THE REMAINING FIVE APPEALS OF THE REVENUE, SINCE THE FACTS AND CIRCUMSTANCES BEING IDENTICAL TO THAT OF REVENUES APPEAL IN ITA NO.1922/AHD/2012 IN THE CASE OF SHRI RAHUL A.SABOO( SUPRA) AND SINCE IN THE CASE OF RAHUL A.SABOO, WE HAVE REMITTED THE IS SUE TO THE FILE OF LD.CIT(A), THEREFORE FOR THE SIMILAR REASONS STATE D HEREINABOVE WHILE DECIDING THE REVENUES APPEAL IN ITA NO.1922/AHD/ 2012, AND FOR SIMILAR REASONS RESTORE THE GROUND BACK TO THE FILE OF LD.CIT(A) AND THUS THE GROUNDS OF REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE COMBINED RESULT, ALL THE SIX APPEALS OF T HE REVENUE ARE ALLOWED FOR STATISTICAL PURPOSES. THIS ORDER PRONOUNCED IN OPEN COURT ON 07/07/2016 SD/- SD/- .. () () ( R.P. TOLANI ) ( ANIL CHATURVEDI ) JUDICIAL MEMBER ACCOUNTANT MEMBER AHMEDABAD; DATED 07/ 07 /2016 ,..,.../ T.C. NAIR, SR. PS ITA NOS.1922 TO 1927/AHD/2012 ITO VS. VS. RAHUL A.SABOO & OTHERS ASST.YEAR 2009-10 - 20 - ! ' / COPY OF THE ORDER FORWARDED TO : 1. -. / THE APPELLANT 2. /0-. / THE RESPONDENT. 3. 123 4 / CONCERNED CIT 4. 4 ( ) / THE CIT(A)-XI, AHMEDABAD 5. 567/23 , 23' , 1 / DR, ITAT, AHMEDABAD 6. 79:# / GUARD FILE. / BY ORDER, 05/ //TRUE COPY// / ( DY./ASSTT.REGISTRAR) , / ITAT, AHMEDABAD 1. DATE OF DICTATION .. 17.6.16 (DICTATION-PAD 13+ PAGES ATTACHED AT THE END OF THIS APPEAL-FILE) 2. DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE THE DICTATING MEMBER 23.6.16/28.6.16 3. OTHER MEMBER 4. DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR.P. S./P.S.. 5. DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE D ICTATING MEMBER FOR PRONOUNCEMENT 6. DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR.P .S./P.S. 7. DATE ON WHICH THE FILE GOES TO THE BENCH CLERK 8. DATE ON WHICH THE FILE GOES TO THE HEAD CLERK ... 9. THE DATE ON WHICH THE FILE GOES TO THE ASSISTANT RE GISTRAR FOR SIGNATURE ON THE ORDER.. 10. DATE OF DESPATCH OF THE ORDER