DEV BHOOMI AUTOMOBILES PVT. LTD., DEHRADUN V. ACIT, CIRCLE, HARIDWAR

ITA 2150/DEL/2018

• Counselvise Citation: [2021] 108 COUNSELVISE.COM (IT) 4225 (ITAT-DEHRADUN)
• Duration Of Justice: 3 year(s) 2 month(s) 2 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 31-05-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: DB
• Assessment Year: 2008-2009
• Appeal Filed On: 28-03-2018
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: N C UPPADHAY
• Assessee Lawyers: SANJAY ARORA
• Keywords: Rejection of books of accounts; Condonation of delay; Revised return; Set aside
• Section: 271(1)(c); 143(3); 13; 145(3); 22; 145; 148; 144

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DEHRADUN CIRCUIT BENCH: DEHRADUN BEFORE, SHRI SUDHANSHU SRIVASTAVA, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER ITA NO.2149/DEL/2018 (ASSESSMENT YEAR 2007-08) ITA NO.2150/DEL/2018 (ASSESSMENT YEAR 2008-09) DEV BHOOMI AUTOMOBILES PVT. LTD., 108, HARIDWAR ROAD, DEHRADUN. PAN AAFFD 0757Q VS. ASST. CIT, CIRCLE HARIDWAR. (APPELLANT) (RESPONDENT) APPELLANT BY SH. HEMANT ARORA, CA SH. JEETAN NAGPAL, CA & SH. SANJAY ARORA, CA RESPONDENT BY SH. N.C. UPPADHAY, SR. DR DATE OF HEARING 04.03.2021 DATE OF PRONOUNCEMENT 31.05.2021 ORDER PER SUDHANSHU SRIVASTAVA, JM: ITA NO. 2149/DEL/2018 IS PREFERRED BY THE ASSE SSEE AGAINST ORDER DATED 31.03.2017 PASSED BY THE LEARNE D COMMISSIONER OF INCOME TAX (APPEALS)-2, AGRA (CAMP AT DEHRADUN) 2 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT {CIT (A)} FOR ASSESSMENT YEAR 2007-08. ITA NO.215 0/DEL/2018 IS THE ASSESSEES APPEAL AGAINST ORDER OF EVEN DATE AS ABOVE FOR ASSESSMENT YEAR 2008-09. SINCE, BOTH THE APPEALS IN VOLVED IDENTICAL ISSUES, THEY WERE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER FOR THE SAKE OF CONVENIENCE. 2.0 THE BRIEF FACTS OF THE CASE ARE THA T THE ASSESSEE IS A PRIVATE LIMITED COMPANY AND FOR THE CAPTIONED ASSES SMENT YEARS WAS RUNNING ITS BUSINESS AS DEALER IN HYUNDAI MOTOR CARS. FOR ASSESSMENT YEAR 2007-08, THE RETURN WAS FILED DECLAR ING AN INCOME OF RS.4,73,924/-. THE ASSESSMENT U/S 143(3) OF THE ACT WAS COMPLETED ON 30.12.2009 WHEREIN THE INCOME WAS ASSESS ED AT RS.5,84,205/-. ON APPEAL, THE ASSESSEE WAS ALLOWED RELIEF BY THE LD. CIT (A) AND THE TOTAL INCOME STOOD DETERMINED AT RS .4,84,205/-. THE SALES DURING THE ASSESSMENT YEAR 2007-08 AMOUNT ED TO RS.34,49,13,323/- AND THE GROSS PROFIT HAD BEEN DEC LARED AT RS.1,99,38,215/- . THE NET PROFIT DECLARED WAS RS.4, 93,654/-. SUBSEQUENTLY, THE ASSESSEE FILED A LETTER DATED 14. 01.2013 BEFORE THE ASSESSING OFFICER (AO) MAKING A DISCLOSURE THAT CERTAIN INCOMES 3 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT HAD BEEN OMITTED FROM BEING OFFERED TO TAX IN THE I NCOME TAX RETURN ORIGINALLY FILED AND ASSESSED. AS PER THE SAID LETT ER, CERTAIN SALES HAD BEEN OMITTED FROM BEING OFFERED TO TAX. THE ASS ESSEE ALSO ADMITTED THAT THIS LETTER WAS CONSEQUENT TO A SURVEY CONDUCTED BY THE COMMERCIAL TAX DEPARTMENT ON 07.08.2012 WHEREIN IT WAS FOUND THAT THE ASSESSEE HAD UNDERSTATED ITS SALES A ND CORRESPONDING PURCHASES. 2.1 BASED ON THIS INFORMATION, THE ASSE SSING OFFICER ISSUED NOTICE U/S 148 OF THE INCOME TAX ACT, 1961 ( HEREINAFTER CALLED THE ACT) ON 13.03.2013 AND IN RESPONSE TO THE SAID NOTICE, THE ASSESSEE FILED THE RETURN OF INCOME. THE RE-ASS ESSMENT PROCEEDINGS CULMINATED WITH PASSING THE ASSESSMENT O RDER WHEREIN THE ASSESSING OFFICER REJECTED THE BOOKS OF ACCOUNT S BY INVOKING PROVISIONS OF SECTION 145(3) OF THE ACT AND ESTIMAT ED THE ASSESSEES INCOME BY MAKING BEST JUDGMENT ASSESSMENT OF INCOME U/S 144 OF THE ACT. FOR ASSESSMENT YEAR 2007-08 THE ADDITIONS WERE MADE AS UNDER: (I) CONCEALED PROFIT RS. 30,04,088/- (II) CONCEALED CAPITAL RS.2,61,01,5 09/- 4 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 2.2 THE ASSESSEE ACCEPTED THE ADDITION ON ACCOUNT OF CONCEALED PROFIT BUT CHALLENGED THE ADDITION ON ACC OUNT OF CONCEALED CAPITAL BEFORE THE LD. CIT (A) WHO, VIDE T HE IMPUGNED ORDER DISMISSED THE ASSESSEES APPEAL. AGAINST THE IMPUGNED ORDER, THE ASSESSEE IS NOW BEFORE THIS TRIBUNAL AND HAS RAI SED THE FOLLOWING GROUNDS OF APPEAL: 1. THAT THE APPELLATE ORDER DATED 31.03.2017 PASSE D BY HONBLE CIT (A) U/S 250(6) OF THE ACT IS BASED ON S URMISES AND CONJECTURES AND IS AGAINST THE FACTS AND CIRCUMSTAN CES OF THE CASE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE HONBLE CIT (A) HAS ERRED IN UPHOLDING THE REJECTIO N OF BOOKS OF ACCOUNTS OF THE APPELLANT U/S 145(3) OF THE ACT, BE CAUSE: 2.1 THE REJECTION OF BOOKS OF ACCOUNTS IS BASED UPON CONJECTURES AND SURMISES AS NO DEFICIENCIES HAVE BE EN POINTED OUT IN THE BOOKS OF ACCOUNTS BY THE LD. AO. 2.2 THAT THE BOOKS OF ACCOUNTS HAVE BEEN REJECTED WITHO UT POINTING OUT ANY SPECIFIC INSTANCE TO INDICATE LACK OF CORRECTNESS AND COMPLETENESS THEREOF. 3. THAT THE HONBLE CIT (A) HAS ERRED ON FAC TS IN UPHOLDING THE ADDITION OF RS.1,03,94,769/- MADE BY THE LD. AO ON ACCOUNT OF DEPLOYMENT OF UNDISCLOSED CAPITAL, BECAU SE: 5 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 3.1 THE PURCHASE ACCOUNT, CREDITORS ACCOUNTS AND BANK ACCOUNTS WERE DULY PRODUCED BEFORE THE LD. AO DURIN G THE COURSE OF RE-ASSESSMENT PROCEEDINGS AND NO DEFECT W AS POINTED OUT THEREIN. 3.2 THE APPELLANT HAD EXPLAINED THAT ALL PURCHASES MADE BY HIM WERE DULY ACCOUNTED FOR IN THE BOOKS OF ACCOUNT S AND WERE PAID FOR THROUGH FORMAL BANKING CHANNELS, A FACT TH AT HAS NOT BEEN REBUTTED BY THE LD. AO. 3.3 THE ESTIMATION OF TWENTY PERCENT OF THE SUPPRESSED SALES AS UNDISCLOSED CAPITAL IS WITHOUT ANY COGENT BASIS. 4. THAT THE LEVY OF PENALTY U/S 271 (1 )(B) AND 271(1)(C) OF THE ACT IS BAD IN LAW. 5. THAT THE APPELLANT RESERVES THE RIGHT TO ADD , AMEND/MODIFY THE GROUNDS OF APPEAL. 2.3 IN ASSESSMENT YEAR 2008-09, THE FACTS ARE IDE NTICAL TO THE FACTS IN ASSESSMENT YEAR 2007-08. IN ASSESSM ENT YEAR 2008-09, THE RETURN OF INCOME WAS FILED DECLARING T OTAL INCOME OF RS.16,61,440/-. THE SALES WERE DECLARED AT RS.25,99 ,914/- AND THE GROSS PROFIT WAS DECLARED AT RS.2,47,99,911/- WHEREAS THE NET PROFIT DECLARED WAS RS.17,85,908/-. AS IN ASSESSMENT YEAR 2 007-08, LIKEWISE IN ASSESSMENT YEAR 2008-09, THE ASSESSEE HA D FILED LETTER BEFORE THE ASSESSING OFFICER MAKING A DISCLOSURE OF SALES WHICH HAD 6 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT NOT BEEN INCLUDED IN THE ORIGINAL RETURN OF INCOME. FOR ASSESSMENT YEAR 2008-09 ALSO, THE NOTICE U/S 148 OF THE ACT WA S INITIATED AND THE RE-ASSESSMENT PROCEEDINGS WERE COMPLETED ON IDE NTICAL LINES BY THE ASSESSING OFFICER WHEREIN THE FOLLOWING ADDITIONS WERE MADE: (I) CONCEALED PROFIT RS. 1,24,37,369/- (II) CONCEALED CAPITAL RS.2,61,01,5 09/- 2.4 IN ASSESSMENT YEAR 2008-09 ALSO, THE ASSESSEE ACCEPTED THE ADDITION ON ACCOUNT OF CONCEALED PROFI T BUT CHALLENGED THE ADDITION ON ACCOUNT OF CONCEALED CAPITAL BEFORE THE LD. CIT (A) WHICH WAS DISMISSED. IN ASSESSMENT YEAR 2008-09 ALSO THE ASSESSEE HAS APPROACHED THIS TRIBUNAL CHALLENGING T HE ORDER OF THE LD. CIT (A) BY RAISING THE FOLLOWING GROUNDS OF APPE AL: 1. THAT THE APPELLATE ORDER DATED 31.03.2017 PASSE D BY HONBLE CIT (A) U/S 250(6) OF THE ACT IS BASED ON S URMISES AND CONJECTURES AND IS AGAINST THE FACTS AND CIRCUMSTAN CES OF THE CASE. 2. THAT ON THE FACTS AND CIRCUMSTANCES OF THE CASE, THE HONBLE CIT (A) HAS ERRED IN UPHOLDING THE REJECTIO N OF BOOKS OF ACCOUNTS OF THE APPELLANT U/S 145(3) OF THE ACT, BE CAUSE: 7 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 2.1 THE REJECTION OF BOOKS OF ACCOUNTS IS BASED UP ON CONJECTURES AND SURMISES AS NO DEFICIENCIES HAVE BE EN POINTED OUT IN THE BOOKS OF ACCOUNTS BY THE LD. AO. 2.2 THAT THE BOOKS OF ACCOUNTS HAVE BEEN REJECTED W ITHOUT POINTING OUT ANY SPECIFIC INSTANCE TO INDICATE LACK OF CORRECTNESS AND COMPLETENESS THEREOF. 3. THAT THE HONBLE CIT (A) HAS ERRED ON FAC TS IN UPHOLDING THE ADDITION OF RS.2,61,01,509/- MADE BY THE LD. AO ON ACCOUNT OF DEPLOYMENT OF UNDISCLOSED CAPITAL, BECAU SE: 3.1. THE PURCHASE ACCOUNT, CREDITORS ACCOUNTS AN D BANK ACCOUNTS WERE DULY PRODUCED BEFORE THE LD. AO DURIN G THE COURSE OF RE-ASSESSMENT PROCEEDINGS AND NO DEFECT W AS POINTED OUT THEREIN. 3.2. THE APPELLANT HAD EXPLAINED THAT ALL PURCH ASES MADE BY HIM WERE DULY ACCOUNTED FOR IN THE BOOKS OF ACCO UNTS AND WERE PAID FOR THROUGH FORMAL BANKING CHANNELS, A FA CT THAT HAS NOT BEEN REBUTTED BY THE LD. AO. 3.3. THE ESTIMATION OF TWENTY PERCENT OF THE SUPPRESSED SALES AS UNDISCLOSED CAPITAL IS WITHOUT ANY COGENT BASIS. 4. THAT THE LEVY OF PENALTY U/S 271 (1)(B ) AND 271(1)(C) OF THE ACT IS BAD IN LAW. 5. THAT THE APPELLANT RESERVES THE RIGHT TO ADD , AMEND/MODIFY THE GROUNDS OF APPEAL. 8 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 3.0 AT THE OUTSET, THE LD. AUTHORIZED REPRESENTATIVE (AR) SUBMITTED THAT THERE WAS A DELAY OF 275 DAYS IN FILING OF BOTH THE CAPTIONED APPEALS BEFORE THIS TR IBUNAL. IN THIS REGARD, IT WAS SUBMITTED THAT EARLIER THE ASSESSEE C OMPANYS AFFAIRS WERE BEING LOOKED AFTER BY SHRI AMRISH OBEROI (THE D IRECTOR) BUT THE SUBSEQUENT TO THE SEARCH BY THE COMMERCIAL TAX DEPA RTMENT ON 07.08.2012, THE BUSINESS OF THE ASSESSEE COMPANY HA D TO BE CLOSED DOWN AND SUBSEQUENTLY THE BANKERS FROM WHICH THE ASSE SSEE COMPANY HAD AVAILED CREDIT LIMIT ATTACHED THE ASSET S OF THE ASSESSEE COMPANY AND HAD ALSO INVOKED PERSONAL GUARANTEES OF THE DIRECTORS BY TAKING OVER THE POSSESSION OF THE PREMISES OF TH E COMPANY AS WELL AS RESIDENCE OF SHRI AMRISH OBERAI. IT WAS FURT HER SUBMITTED THAT SINCE THERE WAS SUBSTANTIAL OUTSTANDING CREDITS AS WELL AS GOVERNMENT DUES PAYABLE BY THE COMPANY, THERE WERE SEVERAL LITIGATIONS WHICH THE ASSESSEE HAD TO FACE AND ALSO THE EMPLOYEES OF THE ASSESSEE COMPANY HAD TO BE LAID OFF. IT WAS FURT HER SUBMITTED THAT SHRI AMRISH OBEROI WAS SUFFERING FROM DEPRESSIO N AND ANXIETY AND HE COULD NOT REGULARLY ATTEND THE AFFAIRS OF TH E ASSESSEE COMPANY, THEREBY, LEADING TO THE DELAY IN FILING OF THE APPEALS. THE 9 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT AUTHORIZED REPRESENTATIVE ALSO DREW OUR ATTENTION TO AN AFFIDAVIT FILED BY SHRI AMRISH OBEROI IN THIS REGARD AS WELL AS TO THE ANNEXURES TO THE DELAY CONDONATION APPLICATION WHICH INCLUDES DETAILS OF THE LITIGATIONS AS WELL AS THE NOTICE OF ATTACHMENT SERVED BY THE BANKERS OF THE ASSESSEE COMPANY AND ALSO THE MEDICAL CERTIFICATES OF SHRI AMRISH OBEROI. THE LD. AUTHOR IZED REPRESENTATIVE SUBMITTED THAT IN VIEW OF THE EXTREME HARDSHIP AND ADVERSE CIRCUMSTANCES, THE CAPTIONED APPEALS COULD NOT BE FILED IN TIME AND PRAYED THAT THE DELAY BE CONDONED SO THAT THE ASSESSEE CAN GET SUBSTANTIAL JUSTICE FROM THIS TRIBUNAL. 4.0 ON THE OTHER HAND, THE LD. DEPARTMENTAL REPRESENTATIVE (DR) VEHEMENTLY OPPOSED THE REQUEST MADE FOR CONDONATION OF DELAY. 5.0 HAVING HEARD BOTH THE PARTIES ON THE ISSUE O F CONDONATION OF DELAY, IT IS SEEN THAT IT IS SETTLED LAW THAT THE COURTS AND THE QUASI-JUDICIAL BODIES ARE EMPOWERED TO COND ONE THE DELAY IF THE LITIGANT SATISFIES THE COURT THAT THERE WERE SU FFICIENT REASONS FOR AVAILING THE REMEDY AFTER THE EXPIRY OF THE LIMITAT ION. SUCH REASONING SHOULD BE TO THE SATISFACTION OF THE COUR T. THE EXPRESSION 10 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT SUFFICIENT CAUSE OR REASON AS PROVIDED IN SUB-SEC TION (5) OF SECTION 253, SUBSECTION (3) SECTION 249 OF THE INCOME TAX A CT, 1961 IS USED IN IDENTICAL TERMS IN THE LIMITATION ACT AND THE CI VIL PROCEDURE CODE. SUCH EXPRESSION HAS ALSO BEEN USED IN OTHER S ECTIONS OF THE INCOME TAX ACT SUCH AS SECTIONS 274, 273 ETC. THE E XPRESSION SUFFICIENT CAUSE WITHIN THE MEANING OF SECTION 5 O F THE LIMITATION ACT AS WELL AS SIMILAR OTHER PROVISIONS AND THE AMB IT OF EXERCISE OF POWERS THERE UNDER HAVE BEEN THE SUBJECT-MATTER OF CONSIDERATION BEFORE THE HONBLE APEX COURT ON VARIOUS OCCASIONS. IN THE CASE OF STATE OF WEST BENGAL V. ADMINISTRATOR; HOWRAH MUNIC IPALITY AIR 1972 SC 749 , THE HONBLE SUPREME COURT, WHILE CONSIDERING THE S COPE OF THE EXPRESSION SUFFICIENT CAUSE FOR CONDONATION O F DELAY, HAS HELD THAT THE SAID EXPRESSION SHOULD RECEIVE A LIBERAL C ONSTRUCTION SO AS TO ADVANCE SUBSTANTIAL JUSTICE WHEN NO NEGLIGENCE OR INACTION OR WANT OF BONA FIDE IS IMPUTABLE TO THE PARTY. 5.1 IN THE CASE OF N. BALAKRISHNAN V. M. KRISHNAMURTHY AIR 1998 SC 3222 , THERE WAS A DELAY OF 883 DAYS IN FILING AN APPLICATION FOR SETTING ASIDE THE EX PARTE DECREE FOR WHICH THE APPLICATION FOR CONDONATION OF DELAY WAS FILED. THE TRIAL COURT 11 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT HAVING FOUND THAT SUFFICIENT CAUSE WAS MADE OUT FOR CONDONATION OF DELAY CONDONED THE DELAY. HOWEVER, THE HONBLE COUR T REVERSED THE ORDER OF THE TRIAL COURT. THE HONBLE SUPREME COURT WHILE RESTORING THE ORDER OF THE TRIAL COURT HAS OBSERVED IN PARA 8 , 9 AND 10 AS UNDER:- 8. THE APPELLANTS CONDUCT DOES NOT ON THE WHOLE W ARRANT TO CASTIGATE HIM AS AN IRRESPONSIBLE LITIGANT. WHAT HE DID IN DEFENDING THE SUIT WAS NOT VERY MUCH FAR FROM WHAT A LITIGANT WOULD BROADLY DO. OF COURSE, IT MAY BE SAID THAT HE SHOULD HAVE BEEN MORE VIGILANT BY VISITING HIS ADVOCATE AT SHOR T INTERVALS TO CHECK UP THE PROGRESS OF THE LITIGATION. BUT DURING THESE DAYS WHEN EVERYBODY IS FULLY OCCUPIED WITH HIS OWN AVOCA TION OF LIFE, AN OMISSION TO ADOPT SUCH EXTRA VIGILANCE NEED NOT BE USED AS GROUND TO DEPICT HIM AS A LITIGANT NOT AWARE OF HIS RESPONSIBILITIES AND TO VISIT HIM WITH DRASTIC CONS EQUENCES. 9. IT IS AXIOMATIC THAT CONDONATION OF DELAY IS A M ATTER OF DISCRETION OF THE COURT. SECTION 5 OF THE LIMITATIO N ACT DOES NOT SAY THAT SUCH DISCRETION OF THE COURT. SECTION 5 OF THE LIMITATION ACT DOES NOT SAY THAT SUCH DISCRETION CAN BE EXERCI SED ONLY IF THE DELAY IS WITHIN A CERTAIN LIMIT. LENGTH OF DELA Y IS NO MATTER, ACCEPTABILITY OF THE EXPLANATION IS THE ONLY CRITER ION. SOMETIMES DELAY OF THE SHORTEST RANGE MAY BE UNCONDEMNABLE DU E TO A WANT OF ACCEPTABLE EXPLANATION, WHEREAS IN CERTAIN OTHER CASES, 12 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT DELAY OF A VERY LONG RANGE CAN BE CONDONED AS THE E XPLANATION THEREOF IS SATISFACTORY. ONCE THE COURT ACCEPTS THE EXPLANATION AS SUFFICIENT, IT IS THE RESULT OF POSITIVE EXERCIS E OF DISCRETION AND NORMALLY THE SUPERIOR COURT SHOULD NOT DISTURB SUCH FINDING, MUCH LESS IN REVISIONAL JURISDICTION, UNLESS THE EX ERCISE OF DISCRETION WAS ON WHOLLY UNTENABLE GROUNDS OR ARBIT RARY OR PERVERSE. BUT IT IS A DIFFERENT MATTER WHEN THE FIR ST COURT REFUSES TO CONDONE THE DELAY. IN SUCH CASES, THE SUPERIOR C OURT WOULD BE FREE TO CONSIDER THE CAUSE SHOWN FOR THE DELAY AFRE SH AND IN ITS OWN FINDING EVEN UNTRAMMELED BY THE CONCLUSION OF T HE LOWER COURT. 10. THE PRIMARY FUNCTION OF A COURT IS TO ADJUDICATE TH E DISPUTE BETWEEN THE PARTIES AND TO ADVANCE SUBSTANTIAL JUST ICE. THE TIME-LIMIT FIXED FOR APPROACHING THE COURT IN DIFFE RENT SITUATION IS NOT BECAUSE ON THE EXPIRY OF SUCH TIME A BAD CAUSE WOULD TRANSFORM INTO A GOOD CAUSE. 5.2 THE HONBLE SUPREME COURT FURTHER OBSERVED TH AT RULES OF LIMITATION ARE NOT MEANT TO DESTROY THE RI GHTS OF THE PARTIES. THEY ARE MEANT TO SEE THAT THE PARTIES DO NOT RESOR T TO DILATORY TACTICS BUT SEEK THE REMEDY PROMPTLY. THE HONBLE A PEX COURT FURTHER OBSERVED THAT REFUSAL TO CONDONE THE DELAY WOULD RESULT IN FORECLOSING A SUITOR FROM PUTTING FORTH HIS CAUSE. THERE IS NO 13 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT PRESUMPTION THAT THE DELAY IN APPROACHING THE COURT IS ALWAYS DELIBERATE. 5.3 THE HONBLE SUPREME COURT IN SLP [CIVIL NO.12 980 OF 1986, DECIDED ON 19 TH FEB., 1987, IN THE CASE OF COLLECTOR, LAND ACQUISITION V. MST. KATIJI [1987] 2 SCC 107 , HAS LAID DOWN THE FOLLOWING GUIDELINES: 1. ORDINARILY A LITIGANT DOES NOT STAND TO BENEFIT BY LODGING AN APPEAL LATE. 2. REFUSING TO CONDONE DELAY CAN RESULT IN MERITORI OUS MATTER BEING THROWN OUT AT THE VERY THRESHOLD AND CAUSE OF JUSTICE BEING DEFEATED. AS AGAINST THIS WHEN DELAY IS CONDO NED THE HIGHEST THEN CAN HAPPEN IS THAT A CAUSE WOULD BE DE CIDED ON MERITS WAFTER HEARING THE PARTIES. 3. EVERY DAYS DELAY MUST BE EXPLAINED DOES NOT M EAN THAT A PEDANTIC APPROACH SHOULD BE MADE, WHY NOT EVERY H OURS DELAY, EVERY SECONDS DELAY. THE DOCTRINE UST BE AP PLIED ON A RATIONAL COMMONSENSE PRAGMATIC MANNER. 4. WHEN SUBSTANTIAL JUSTICE AND TECHNICAL CONSIDERA TIONS ARE PITTED AGAINST EACH OTHER, CAUSE OF SUBSTANTIAL JUS TICE DESERVES TO BE PREFERRED, FOR THE OTHER SIDE CANNOT CLAIM TO HAVE VESTED RIGHT IN INJUSTICE BEING DONE BECAUSE OF A NON-DELI BERATE DELAY. 14 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 5. THERE IS NO PRESUMPTION THAT DELAY IS OCCASIONED DELIBERATELY, OR ON ACCOUNT OF CULPABLE NEGLIGENCE, OR ON ACCOUNT OF MALA FIDES. A LITIGANT DOES NOT STAND TO BENEFIT BY RESORTING TO DELAY. IN FACT HE RUNS A SERIOUS RISK. 6. IT MUST BE GRASPED THAT JUDICIARY IS RESPECTED N OT ON ACCOUNT OF ITS POWER TO LEGALIZE INJUSTICE ON TECHN ICAL GROUNDS BUT BECAUSE IT IS CAPABLE OF REMOVING INJUSTICE AND IS EXPECTED TO SO. 5.4 IN THE LIGHT OF THE ABOVE CITED JUDGMENTS, I F WE EXAMINE THE FACTS OF THE PRESENT CASE, IT IS APPARE NT THAT THE ASSESSEE HAS BEEN VIGILANT IN HIS APPROACH AND HAS NOT NEGLECTED THE INCOME TAX PROCEEDINGS. THE HONBLE APEX COURT IN THE CASE OF N. BALAKRISHNAN (SUPRA) HAS OBSERVED THAT THE LENGT H OF DELAY IS IMMATERIAL. THE ACCEPTABILITY OF THE EXPLANATION IS THE ONLY CRITERIA FOR CONDONING THE DELAY. IN A GIVEN CASE, DELAY OF THE SHORTEST PERIOD OF TIME MAY BE UN-CONDONABLE DUE TO UNACCEPTABLE EX PLANATION, WHEREAS IN CERTAIN OTHER CASES, DELAY OF A LONG PER IOD CAN BE CONDONED IF THE EXPLANATION IS SATISFACTORY. IN EVE RY CASE OF DELAY, THERE MIGHT BE SOME OMISSIONS OR NEGLIGENCE ON THE PART OF THE ASSESSEE BUT TO OUR MIND SUCH OMISSION/NEGLIGENCE H AS TO BE WEIGHED IN LIGHT OF FACTS AND CIRCUMSTANCES OF EACH CASE. IF THE 15 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT NEGLIGENCE OR OMISSION IS A BY-PRODUCT OF A DELIBER ATE ATTEMPT WITH MALA FIDE INTENTION FOR DELAYING THE PROCESS OF LITIGATION WH ICH COULD GIVE SOME BENEFIT TO THE LITIGANT, THEN PROBABLY TH E DELAY WOULD NOT DESERVE TO BE CONDONED. HOWEVER, IF NO MALA FIDE CAN BE ATTRIBUTED TO THE DELAY, THE DELAY WILL BE CONDONABLE. THEREFOR E, ON THE FACTS OF THE PRESENT CASE, WE ARE OF THE CONSIDERED OPINION T HAT THE ASSESSEE HAS BEEN ABLE TO DEMONSTRATE SUFFICIENT REASONS FOR THE DELAY IN FILING THESE APPEALS BEFORE THE TRIBUNAL. THEREFORE , WE DEEM IT FIT TO CONDONE THE DELAY AND ADMIT BOTH THE APPEALS. 6.0 THE LD. AUTHORIZED REPRESENTATIVE SUBMITTED TH AT THE ASSESSING OFFICER HAD ERRED IN REJECTING THE BOOKS OF ACCOUNT BECAUSE NO DEFICIENCIES HAVE BEEN POINTED OUT BY HI M. IT WAS SUBMITTED THAT THE REJECTION OF BOOKS OF ACCOUNT WAS BASED ON MERE CONJECTURES AND SURMISES WITHOUT APPLICATION OF MIND ON THE PART OF THE ASSESSING OFFICER IN AS MUCH AS THE REJECTION H AD BEEN MADE WITHOUT POINTING OUT ANY SPECIFIC INSTANCE TO INDICA TE LACK OF CORRECTNESS AND COMPLETENESS THEREOF. IT WAS SUBMITT ED THAT THE MERE REASON OF FALL IN GROSS PROFIT CANNOT BE A SUF FICIENT REASON FOR THE REJECTION OF THE BOOKS OF ACCOUNT. IT WAS SUBMIT TED THAT THE 16 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT ALLEGATION OF THE ASSESSING OFFICER THAT THE ASSESS EE MAINTAINED TWO SETS BOOKS OF ACCOUNTS WAS INCORRECT IN AS MUCH AS T HE ASSESSEE HAS ADMITTED TO HAVE RE-CASTED THE BOOKS OF ACCOUNT S PURSUANT TO THE SURVEY CONDUCTED BY THE COMMERCIAL TAX DEPARTME NT SO AS TO INCORPORATE THEREIN THE CORRECT SALES, PURCHASES, O PENING AND CLOSING STOCK ETC. AND THE REVISED RETURNS WERE FIL ED BASED ON SUCH RE-CAST ACCOUNTS. IT WAS SUBMITTED THAT THE MERE PRO DUCTION OF REVISED ACCOUNTS TO SUBSTANTIATE THE REVISED RETURN OUGHT NOT TO HAVE LED THE ASSESSING OFFICER TO REJECT THE BOOKS OF ACCOUNTS WITHOUT ANY OTHER COGENT REASON. THE LD. AUTHORIZED REPRESENTATIVE PLACED RELIANCE ON NUMEROUS CASE LAWS TO BUTTRESS TH E ASSESSEES CONTENTION THAT THE BOOKS OF ACCOUNT HAD BEEN WRONGL Y REJECTED. 6.1 WITH RESPECT TO THE ASSESSEES MAIN G RIEVANCE THAT IS THE ADDITION ON ACCOUNT OF ALLEGED CONCEALED CAPITAL OF RS.1,03,94,769/- IN ASSESSMENT YEAR 2007-08 AND RS.2,61,01,509/- IN ASSESSMENT YEAR 2008-09, THE LD. AUTHORIZED REPRESENTATIVE SUB MITTED THAT THESE ADDITIONS WERE WRONG BOTH ON FACTS AS WELL AS I N LAW FOR THE REASON THAT SINCE THE ASSESSEE WAS DEALER IN HYUNDAI MOTOR CARS, ALL THE PAYMENTS TO THE HYUNDAI MOTOR COMPANY HAD T O BE MADE 17 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT THROUGH REGULAR BANKING CHANNELS AND THERE WAS NO QU ESTION OF BUYING ANY CARS IN CASH. IT WAS SUBMITTED THAT THE A SSESSING OFFICER HAD MADE THIS ADDITION ON THE GROUND THAT UNDISCLOS ED CAPITAL WOULD SURELY BE NEEDED FOR THE MAKING UNDISCLOSED SA LES AND HAD MADE THE ADDITION @ 20% OF THE UNDISCLOSED SALES IN BOTH THE YEARS WHICH WAS A MERE ASSUMPTION LACKING ANY BASIS. THE LD . AR SUBMITTED THAT THE PURCHASE ACCOUNTS, CREDITORS AC COUNTS AND THE BANK ACCOUNTS WERE DULY PRODUCED BEFORE THE ASSESSIN G OFFICER DURING THE COURSE OF RE-ASSESSMENT PROCEEDINGS AND NO DEFECT HAD BEEN POINTED OUT THEREIN BY THE ASSESSING OFFICER. IT WAS ALSO ARGUED THAT THE ASSESSEE HAS SUBMITTED THE LEDGER A CCOUNT OF HYUNDAI MOTOR INDIA LTD. IN THE BOOKS OF THE ASSESS EE WHICH WAS RECONCILED WITH THE STATEMENT OF ACCOUNTS RECEIVED F ROM HYUNDAI MOTOR CARS LTD. IT WAS SUBMITTED THAT, THEREFORE, IT WAS EVIDENT THAT THERE WAS NO UNDISCLOSED CAPITAL EMPLOYED BY THE ASS ESSEE AS HAS BEEN ALLEGED BY THE ASSESSING OFFICER AND UPHELD BY THE LD. CIT (A). THE LD. AUTHORIZED REPRESENTATIVE PLACED RELIANCE O N NUMEROUS JUDICIAL PRECEDENTS TO SUPPORT OF HIS CONTENTION TH AT NO ADDITION 18 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT COULD HAVE BEEN MADE ON ACCOUNT OF ALLEGED CONCEALE D CAPITAL WITHOUT HAVING BROUGHT ANYTHING ADVERSE ON RECORD. 6.2 THE LD. AR ALSO SUBMITTED THAT THOUGH THE ASS ESSEE HAD ACCEPTED THE ADDITION ON ACCOUNT OF CONCEALED P ROFIT IN BOTH THE ASSESSMENT YEARS, HOWEVER, THERE WAS A COMPUTATIONAL ERROR IN COMPUTING SUCH CONCEALED PROFITS IN ASSESSMENT YEAR 2008-09. A CHART WAS FILED INDICATING SUCH COMPUTATIONAL ERROR AND IT WAS PRAYED THAT SUITABLE DIRECTIONS MAY BE GIVEN IN THI S REGARD TO RECTIFY THE SAME. 7.0 PER CONTRA, THE LD. SR. DEPARTMENTAL REPR ESENTATIVE (DR) VEHEMENTLY ARGUED THAT AS PER ASSESSEES OWN AD MITTANCE, THE ASSESSEE HAD CONCEALED SALES IN THE TWO CAPTIONED YE ARS AND HAD ALSO ACCEPTED THE ADDITION ON ACCOUNT OF ADDITIONAL PROFIT EARNED BY THE ASSESSEE IN BOTH THE YEARS UNDER CONSIDERATION. IT WAS SUBMITTED THAT FOR MAKING ADDITIONAL SALES, ADDITIO NAL CAPITAL IS UNDOUBTEDLY REQUIRED AND, THEREFORE, THE CLAIM OF T HE ASSESSEE THAT THERE WAS NO UNDISCLOSED CAPITAL IS COMPLETELY WRONG. IT WAS SUBMITTED THAT ALTHOUGH ALL THE PURCHASES MIGHT HAV E BEEN MADE THROUGH CASH, THERE WERE SO MANY OTHER EXPENSES WHIC H ARE TO BE 19 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT INCURRED WHEN MAKING UNDISCLOSED SALES. THE LD. SR. DEPARTMENTAL REPRESENTATIVE SUBMITTED THAT THE ADDITION ON ACCOU NT OF UNDISCLOSED CAPITAL @ 20% WAS A VERY REASONABLE EST IMATE OF SUCH UNDISCLOSED INVESTMENT. THE LD. SR. DR ALSO SUBMITT ED THAT THE REJECTION OF BOOKS OF ACCOUNTS WAS VERY MUCH CORRECT BECAUSE AS PER THE ASSESSEES OWN ADMITTANCE, THE ASSESSEE HAD NOT CORRECTLY DISCLOSED THE SALES AND, THEREFORE, IT WAS VERY EVID ENT THAT THE ASSESSEE HAD BEEN MAINTAINING TWO SETS OF BOOKS OF A CCOUNTS. THE LD. SR. DR ALSO ARGUED THAT THE LD. CIT (A) HAD CON FIRMED THE FINDINGS OF THE ASSESSING OFFICER AND SUCH CONCURRE NT FINDINGS OUGHT TO BE UPHELD. 8.0 WE HAVE HEARD THE RIVAL SUBMISSIONS AND HAVE ALSO PERUSED THE MATERIAL ON RECORD. IN FAR AS THE ISSUE TO REJECTION OF BOOKS OF ACCOUNTS IS CONCERNED, IT IS TRITE THAT SECTION 145(3) OF THE ACT CAN BE INVOKED BY THE ASSESSING OFFICER IN ANY OF THE FOLLOWING CIRCUMSTANCES ALONE AND NOT OTHERWISE: (A) WHERE HE IS NOT SATISFIED ABOUT THE CORRECTN ESS OR COMPLETENESS OF THE ACCOUNTS; OR 20 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT (B) WHERE METHOD OF ACCOUNTING CASH OR MERCAN TILE HAS NOT BEEN REGULARLY FOLLOWED BY THE ASSESSEE; OR (C) ACCOUNTING STANDARDS AS NOTIFIED BY THE C ENTRAL GOVERNMENT HAVE NOT BEEN REGULARLY FOLLOWED BY THE ASSESSEE. 8.1 THEREFORE, BOOKS OF ACCOUNT CAN BE REJECTED O NLY IF THEY FALL UNDER ANY OF THE ABOVE THREE CIRCUMSTANCE S AND NOT OTHERWISE. THE ASSESSING OFFICER HAS MENTIONED A FAL L IN GROSS PROFIT RATE AS THE REASON FOR REJECTING THE BOOKS OF ACCOU NT. HOWEVER, IN OUR CONSIDERED OPINION, THIS IS NOT A SUFFICIENT RE ASON IN ITSELF TO INVOKE THE PROVISIONS OF SECTION 145(3) OF THE ACT. THE ASSESSING OFFICER HAS NOT POINTED OUT ANY SPECIFIC DEFECTS IN BILLS, VOUCHERS OR BOOKS OF ACCOUNTS, AND, HAS MERELY RESORTED TO FIRS T LIMB OF SUB- SECTION (3) OF SECTION 145 AND HAS EXPRESSED DISSAT ISFACTION ABOUT THE CORRECTNESS AND COMPLETENESS OF THE ACCOUNTS MA INTAINED BY THE ASSESSEE. ANOTHER ALLEGATION OF THE ASSESSING O FFICER IS THAT THE NET PROFIT HAD TURNED INTO NET LOSS SUBSEQUENT TO T HE REVISION IN SALES FIGURES AND THAT THE ASSESSEE WAS ALLEGEDLY M AINTAINING TWO SETS OF ACCOUNTS. HOWEVER, WE DO NOT AGREE WITH THE REASONING ADVANCED BY THE ASSESSING OFFICER FOR REJECTION OF BOOKS OF ACCOUNTS 21 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT AS FALL IN GROSS PROFIT RATE OR CONVERSION OF PROFI T INTO LOSS IS NOT A SUFFICIENT REASON TO REJECT BOOKS OF ACCOUNTS IF TH ERE IS NO OTHER DEFECT POINTED OUT BY THE ASSESSING OFFICER IN THIS REGARD. FURTHERMORE, THE ALLEGATION OF THE ASSESSEE MAINTAI NING TWO SETS OF ACCOUNT IS ALSO A MERE ALLEGATION. AS PER ASSESSEE S OWN ADMITTANCE, THE BOOKS OF ACCOUNTS WERE RE-CAST TO IN CORPORATE THE REVISED SALES/PURCHASES AND THE ASSESSEE CANNOT BE EXPECTED TO PROVE THE NEGATIVE IN THIS REGARD ON THE BASIS OF A MERE SUSPICION. ACCORDINGLY, WE ARE NOT IN AGREEMENT WITH THE ACTIO N OF THE LOWER AUTHORITIES IN REJECTING THE BOOKS OF ACCOUNT AND, THEREFORE, WE ACCEPT THE ASSESSEES CONTENTION THAT THE BOOKS OF ACCOUNTS WERE INCORRECTLY REJECTED. 8.2 ALTHOUGH, THE ASSESSEE HAS ACCEPTED IN P RINCIPLE THE ADDITION ON ACCOUNT OF CONCEALED PROFITS IN BOTH TH E YEARSUNDER CONSIDERATION, IN ASSESSMENT YEAR 2008-09 A CHART H AS BEEN FILED IN WHICH THE ASSESSEE HAS CLAIMED THAT THERE IS A CO MPUTATIONAL ERROR IN ESTIMATION OF GROSS PROFIT. AS PER THIS CH ART THE ASSESSING OFFICER HAS ESTIMATED THE GROSS PROFIT IN ASSESSMEN T YEAR 2008-09 AT RS.1,23,98,217/- WHEREAS THE CORRECT ESTIMATION S HOULD HAVE 22 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT BEEN AT RS.83,08,653/- THEREBY RESULTING IN ADDITIO N EXCESS ADDITION OF RS.40,89,564/-. THE SAID CHART IS REPRO DUCED HEREIN UNDER: SALES AS DECLARED IN ITR AND BEFORE VAT AUTHORITIES (REFER PARA 1 AND 2 OF ASSESSMENT ORDER DATED 28.2.2014. AS PER VAT AUTHORITIES AS PER DECLARA TION BEFORE AO DECLARED SALES 20,38,25,291 SUPRESSED SALES 13,05,07,545 SALES AS PER ORIGINAL ITR 25,99,95,91 SUPRESSED SALES AS PER REVISED ITR 8,71,8 4,183 _____________________________________ 33,43,32,836/- 34,71,80,09/ - _____________________________________ SALES WORKED OUT BY THE LD. AO IN ASSESSMENT ORDER DATED 28.2.2014. AS PER ORIGINAL RETURN 25,99,95,91 SUPRESSED SALES AS PER VAT (INSTEAD OF 8.71 CR. DIF FERENITAL) 13,05,07,54 _____________ 39,05,0 3,45 _______ _____ GP @ 9.53% ON 130507545 (INCORRECT SALES ADOPTED BY AO) 1,23,98,217 GP @ 9.53% ON 8,71,84,183 83,08,653 EXCESSIVE ESTIMATION OF GP 40,89,564 23 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 8.3. SINCE, THIS ISSUE HAS TO BE NECESSARILY VER IFIED BY THE ASSESSING OFFICER ONLY, THE SAME IS RESTORED TO THE FILE OF THE ASSESSING OFFICER FOR THE PURPOSE OF COMPUTING THE ESTIMATION OF GROSS PROFIT FOR ASSESSMENT YEAR 2008-09 AFTER GIVI NG AN ADEQUATE OPPORTUNITY TO THE ASSESSEE TO PRESENT ITS CASE. 8.3 COMING TO THE ISSUE OF ADDITION ON ACCOUNT O F ALLEGED CONCEALED CAPITAL, IT IS SEEN THAT IT IS UN DISPUTED THAT THE PURCHASES ARE MADE ONLY THROUGH BANKING CHANNELS AN D THE ACCOUNTS OF HYUNDAI MOTOR LTD. IN THE BOOKS OF ACCO UNTS OF THE ASSESSEE IS DULY RECONCILED WITH THE STATEMENTS OF A CCOUNT PERTAINING TO THE ASSESSEE FROM HYUNDAI MOTOR LTD. THE PAYMENTS FOR PURCHASES ARE DULY EVIDENCED IN THE BANK STATEM ENTS. THE ASSESSING OFFICER HAS MADE THE ADDITION ONLY ON THE GROUND THAT SOME EXTRA CAPITAL MUST HAVE BEEN EMPLOYED FOR PURC HASE OF GOODS FOR MAKING THE UNDISCLOSED SALES. THEREAFTER, THE A SSESSING OFFICER HAS DRAWN A SURMISE THAT IT IS COMMON SENSE THAT FOR UNDISCLOSED SALES, UNDISCLOSED CAPITAL WILL SURELY BE NEEDED. H OWEVER, THIS ACTION OF THE ASSESSING OFFICER IS NOT SUPPORTED BY ANY COGENT REASON OR ESTABLISHED BY ANY FACT FROM THE CASE RECORDS. T HE PURCHASES ARE 24 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT DULY SUPPORTED BY INVOICES, PAYMENTS HAVE BEEN MADE THROUGH BANKING CHANNELS WHICH ARE DULY REFLECTED IN THE BAN K STATEMENTS AND THERE IS NOT EVEN ANY ALLEGATION THAT THE ASSES SEE HAD RECEIVED ANY CASH BACK FROM THE SUPPLIERS. THERE IS NO EVIDE NCE OF EXPENSES HAVING BEEN INCURRED OUT OF BOOKS AND, THUS, THE AS SESSING OFFICER HAS MERELY PROCEEDED ON SURMISE AND CONJECTURES WHIC H REMAIN UNSUBSTANTIATED. 8.4 IN THE CASE OF ITO VS. DEEPAK POPATLAL GALA ITA NO.5930/MUM/2013, THE MUMBAI BENCH OF THE TRIBUNAL HAS HELD AS UNDER: IN ALL THE ABOVE CASES THE CO-ORDINATE BENCHES OF THE TRIBUNAL HAS HELD THAT THE A. O. WAS NOT JUSTIFIED IN MAKING THE ADDITION ON THE BASIS OF STATEMENTS GIVEN BY THIRD PARTIES B EFORE THE SALES TAX DEPARTMENT WITHOUT CONDUCTING ANY OTHER INVESTIGATION. IN THE INSTANT CASE ALSO, THE ASSESS ING OFFICER HAS MADE THE IMPUGNED ADDITION ON THE BASIS OF STATEMEN TS GIVEN BY THE PARTIES BEFORE THE SALES TAX DEPARTMENT. WE NOTICE THAT THE LD. CIT (A) HAS TAKEN NOTE OF THE FACT THAT NO SALES COULD BE EFFECTED WITHOUT PURCHASES .HE HAS FURTHER PLACED R ELIANCE ON 25 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT THE DECISION RENDERED BY HONBLE GUJARAT HIGH COURT IN CASE OF CIT VS. M.K BROTHERS (163 ITR 249}.HE HAS FURTHER R ELIED UPON DECISION RENDERED BY THE TRIBUNAL IN THE CASE OF IT O VS. PREMANARUI (2008) (25 SOT 11) (JODH}, WHEREIN IT HA S BEEN HELD THAT WHERE THE A. 0. HAS MADE ADDITION MERELY ON TH E BASIS OF THE OBSERVATION MADE BY THE SALES TAX DEPARTMENT AN D HAS NOT CONDUCTED ANY INDEPENDENT ENQUIRIES FOR MAKING THE ADDITION ESPECIALLY IN CASE WHERE THE ASSESSEE HAS DISCHARGE D ITS PRIMARY ONUS OF ITA NO-5920/ MUM /2013 SHOWING BOOK S OF ACCOUNTS, PAYMENT BY WAY OF ACCOUNT PAYEE CHEQUE AN D PRODUCING VOUCHERS FOR SALES OF GOODS ,SUCH AN ADDI TION COULD NOT BE SUSTAINED. THE LD. CIT(A) HAS ALSO APPRECIAT ED THE CONTENTION OF ASSESSEE THAT HE WAS NOT PROVIDED WITH AN OPPORTUNITY TO CROSS EXAMINE THE SELLER, WHICH IS R EQUIRED TO BE GIVEN AS PER THE DECISION OF HONBLE KERALA HIGH CO URT IN THE CASE OF PONKUNNAM TRADERS (83 ITR 508 & 102 ITR 366 ). ACCORDINGLY, THE LD. CIT (A) HAS DELETED THE IMPUGN ED ADDITION. ON A CAREFUL PERUSAL OF THE DECISION RENDERED BY LD . CIT (A} WOULD SHOW THAT THE FIRST APPELLATE HAS ANALYSED TH E ISSUE IN 26 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT ALL ANGLES AND APPLIED THE RATIO LAID BY THE HIGH C OURTS AND TRIBUNALS IN DECIDING THIS ISSUE. HENCE, WE DO NOT FIND ANY REASON TO INTERFERE WITH THIS ORDER ON THIS ISSUE . 8.5 SIMILARLY, IN ANOTHER CASE OF RAMESH VS. ACI T IN ITA NO. 2959/MUM/2014, IT WAS HELD BY THE MUMBAI BENCH OF THE ITAT AS UNDER: IN OUR CONSIDERED OPINION, THE PURCHASES ARE SUPPO RTED BY PROPER INVOICE DULY REFLECTED IN THE BOOKS OF ACCOU NTS. THE PAYMENTS HAVE BEEN MADE BY ACCOUNT PAYEE CHEQUE WHI CH ARE DULY REFLECTED IN THE BANK STATEMENT OF THE ASSESSE E. THERE IS NO EVIDENCE TO SHOW THAT THE ASSESSEE HAS RECEIVED CASH BOOK FROM SUPPLIERS. THE ADDITIONS HAVE BEEN MADE MERELY ON THE REPORT OF THE SALES TAX DEPARTMENT BUT AT THE SAME TIME IT CANNOT BE SAID THAT PURCHASES ARE BOGUS. WE, THEREF ORE, SET ASIDE THE FINDING OF THE LD. CIT (A) AND DIRECT THE A. O. TO DELETE THE ADDITION OF RS.4,98,80,892. 8.6 THEREFORE, ON AN OVERALL VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE AND ALSO RELYING ON THE C ASE-LAWS AS AFORESAID MENTIONED, WE DIRECT THE DELETION OF ADDI TION ON ACCOUNT OF CONCEALED CAPITAL IN BOTH THE YEARS UNDER CONSID ERATION. 27 ITA NOS.2149 & 2150/DEL/2018 DEV BHOOMI AUTOMOBILES PVT. LTD. VS. ACIT 9.0 IN THE FINAL RESULT, BOTH THE APPEALS OF THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED ON 31/05/2021. SD/- SD/- (PRASHANT MAHARISHI) (SUDHANSHU SRIVASTAVA ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 31/05/2021 PK/PS COPY FORWARDED TO: 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT(APPEALS) 5. DR: ITAT ASSISTANT REGISTRAR ITAT NEW DELHI (DEHRADUN CIRCUIT BENCH, DEHRADUN)