ITO, Ward - 8(3), Kolkata , Kolkata V. Pandrol Rahee Technologies Pvt. Ltd., , Kolkata

ITA 245/KOL/2019

• Counselvise Citation: [2019] 117 COUNSELVISE.COM (IT) 2200 (ITAT-KOLKATA)
• Duration Of Justice: 4 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 26-06-2019
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: SMC
• Assessment Year: 2007-2008
• Appeal Filed On: 12-02-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: SANKAR HALDER
• Keywords: Unexplained cash credit; Bogus Share capital; Depreciation; Business expenditure; TDS
• Section: 147; 68

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL A - SMC BENCH : KOLKATA [BEFORE HONBLE SHRI S.S. GODARA, JM ] I.T . A NO S . 245 TO 247 /KOL/201 9 A.Y S : 2007 - 08, 08 - 09 & 09 - 10 I.T.O. WARD 8(3), KOLKATA V/S. M/S. PANDROL RAHEE TECHNOLOGIES PVT. LTD. PAN: AADCP4569R (APPELLANT) (RESPONDENT) FOR THE APPELLANT / DEPARTMENT : SHRI SANKAR HALDER,.JCIT, DR FOR THE RESPONDENT / ASSESSEE : NONE DATE OF HEARING : 2 5 - 06 - 2019 DATE OF PRONOUNCEMENT: 26 - 06 - 2019 ORDER SHRI S.S. GODARA, JM : 1. TH ESE THREE R EVENUES APPEALS ARISE FOR ASSESSMENT YEAR 2007 - 08 AGAINST THE CIT(A) , 3 , KOLKATAS SEPARATE ORDER S; DATED 02 - 07 - 2018, 26 - 07 - 2018 PASSED IN CASE NO S . 57/ CIT(A) - 3 /W - 8 (3) - KOL/2015 - 16, 56/CIT(A) - 3/W - 8(3) - KOL/2015 - 16 AND 55/CIT(A) - 3/W - 8(3) - KOL/2015 - 16 ; RESPECTIVELY , INVOLVING PROCEEDINGS U/S 14 7 /14 3(1) OF THE I.T ACT , 1961 (IN SHORT ACT) . 2. CASES CALLED TWICE. N ONE APPEARED AT ASSESSEES BEHEST. IT IS ACCORDINGLY PROCEEDED EX PARTE. 3. IT TRANSPIRES AT THE OUTSET THAT THESE R EVENUES INSTANT FORMER TWO APPEALS SUFFER FROM 170 DAYS AND THE LAST ONE INVOLVES 133 DAYS DELAY IN FIL ING . THE R EVENUE HAS FILED ITS CONDONATION PETITION THROUGH THE I.T.O., WARD - 8 (3), KOLKATA EXPLAINING THE REASONS 2 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 2 THEREOF TO CIRCUMSTANCES BEYOND ITS CONTROL. I ACCEPT THE CONDONATION PETITION S TO CONDONE THE ABOVE STATED DELAY. THE CASES ARE NOW TAKEN UP FOR ADJUDICATION ON MERITS. 4 . IT EMERGES DURING THE COURSE OF HEARING THAT THE REVENUES IDENTICAL FIRST SUBSTANTIVE GROUND IN ALL THE SE CASES SEEKS TO REVIVE SECTION 68 UNEXPLAINED SHARE CAPITAL ADDITION(S) OF RS. 20 , 83 , 600, RS.9 , 80 , 000/ - AND RS.19 , 09 , 070/ - ( ASSESSMENT YEAR WISE); RESPECTIVELY. A PERUSAL OF CIT(A)S ORDER IN FIRST ASSESSMENT YEAR REVEALS THAT HE H AD DULY SOUGHT FOR A REMAND REPORT FROM THE ASSESSING OFFICER. THE SAME SUFFICIENTLY INDICATE D THAT THE AMOUNT IN ISSUE OF RS.11 , 60,000/ - HAD BEEN RECEIVED AS SHARE CAPITAL FROM ITS SISTER CONCERN M/S. RAHEE INDUSTRIES LTD IN THE EARLIER ASSESSMENT YEARS. L EARNED DR FAILS TO DISPUTE THIS CLINCHING FACTUAL POSITION. I THEREFORE SEE NO REASON TO REVIVE THE IMPUGNED ADDITIONS. COMING TO THE BALANCE AMOUNT OF RS.923600/ - IN CASE OF THE VERY GROUP ENTITY . I FIND THAT THE CIT(A) HAS QUOTED THE ASSESSING OFFIC ERS REMAND REPORT NOT INDICATING ANY ADVERSE COMMENTS IN VIEW OF ASSESSEES LEDGER ACCOUNT, CONFIRMATION, BANK STATEMENT, BANK CREDIT SANCTION LETTER AS WELL AS INCOME ASSESSED OF THE SAID GROUP COMPANY TO THE TUNE OF RS.83 , 37 , 509/ - IN THE IMPUGNED ASS ESSMENT YEAR. I CONCLUDE IN THESE FACTS THAT THE REVENUES INSTANT IDENTICAL FIRST SUBSTANTIVE GROUND IN ALL APPEALS IS DEVOID OF MERITS S INCE THE ASSESSING OFFICERS REMAND REPORT (S) HAS ITSELF NOT FOUND ANY ISSUE DURING VERIFICATION PROCESS. THE REVENUES FIRST IDENTICAL SUBSTANTIVE GROUND/GRIEVANCE IN ALL THE SE CASES IS DECLINED. 5 . THE REVENUES SECOND SUBSTANTIVE GRIEVANCE IN ASSESSMENT YEAR 2007 - 08 SEEKS TO REVIVE SECTION 68 ADDITION OF UNEXPLAINED CASH CREDIT AMOUNTING TO RS.2,23,207/ - . I T EMERGES FROM A PERUSAL OF CASE FILE THE ASSESSING OFFICERS REMAND REPORT ITSELF MADE IT CLEAR BEFORE THE CIT(A) THAT THERE WAS NO CREDIT ENTRY IN ASSESSEES BANK ACCOUNT TO THIS 3 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 3 EFFECT . I THEREFORE AFFIRM THE CIT(A)S IMPUGNED FINDINGS UNDER CHALLENGE. THE REVENUES SECOND SUBSTANTIVE GROUND IS DECLINED. 6 . THE R EVENUES THIRD IDENTICAL SUBSTANTIVE GROUND IS THAT THE CIT(A) HAS ERRED IN REVERSING THE ASSESSING OFFICERS ACTION DISALLOWING ASSSSEES BUSINESS EXPENDITURE CLAIM S OF RS. 2805329/ - RS. 23,72,6 74/ - AND RS.36,72,494/ - ASSESSMENT YEAR WISE; RESPECTIVELY DESPITE THE FACT THAT ASSESSEE HAS NO T COMMENCED ITS BUSINESS OPERATIVES IN ALL THESE ASSESSMENT YEARS. THE CIT(A) DISCUSSED IN ASSESSMENT YEAR 2007 - 08 TO THIS EFFECT READS AS UNDER: - DECISION: THE ISSUE IN THIS CASE IS DISALLOWANCE OF THE BUSINESS EXPENSES CLAIMED OF RS. 50,67,063/ - ON THE GROUND THAT THE APPELLANT WAS NOT HAVING ANY BUSINESS ACTIVITY OR OPERATIONAL INCOME DURING THE PREVIOUS YEAR. IT IS THE CONTENTION OF THE APPELLANT THAT O UT OF TOTAL BUSINESS EXPENSES DEBITED IN THE P&L ACCOUNT OF RS. 50,67 ,063/ - A SUM OF RS. 26,94,389/ - HAD BEEN SUO MOTO ADDED BACK IN THE COMPUTATION OF INCOME. THE TOTAL LOSS IN THIS CASE FOR THE YEAR WAS RETURNED AT RS. 24,23,855/ - . THE COMPUTATION OF I NCOME AS PER THE ASSESSEE IS AS FOLLOWS: NET LOSS AS PER P/L A/C RS.50,97,200/ - LESS: 1. DEPRECIATION AS PER CO ACT. 34,281/ - 2. PRELIMINARY EXPENSES 26,94,389/ - 3.FBT 30,137/ - RS.27,58,807/ - ADD: 1. DEPRECIATION AS PER I. T. ACT 72,439/ - 2. PRELIMINARY EXPENSES U/S.35D MAXM. ALLOWABLE@2.5%OF RS. 52,09,000/ - = 1,30,225/ - (1/10 TH ) 13,023/ - RS. 85,462/ - LOSS: RS.24 ,23,855/ - THEREFORE, IT IS SEEN FROM ABOVE THAT THE APPELLANT HAS SUO MOTO ADDED THE PRELIMINARY EXPENSES TO THE EXTENT OF RS. 26,94,389/ - . THE AO HAS STARTED 4 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 4 THE COMPUTATION NOT FROM THE LOSS FIGURE AS SHOWN IN THE P&L ACCOUNT BUT FROM THE LOSS FIGURE AS RETURNED BY THE APPELLANT IN THE COMPUTATION. THE SAME IS REPRODUCED AS FOLLOWS: LOSS AS PER RETURN : (24,23,855/ - ) ADD :SHARE CAPITAL]AS PER PARA - 2(A)] 20,83,600/ - CREDIT ENTRY ( AS PER PARA - 2(B)] 2,23,207/ - EXPENSES ( AS PER PARA - 3] 50,67,063/ - 49,50,015/ - IN THE ABOVE COMPUTATION OF THE THE STARTING POINT SHOULD HAV E BEEN LOSS AS PER THE P& L ACCOUNT AND THEN ENTIRE EXPENSES COULD HAVE BEEN ADDED BACK. AS HE STARTED FROM THE FIGURE OF LOSS AS PER RETURN ONLY THE EXPENSES TO THE EXTENT CLAIMED BY THE APPELLANT SHOULD HAVE BEEN ADDED BACK. IT IS OBSERV ED THAT THE PRELIMINARY EXPENSES OF RS. 26, 94,389 / - - HAVE NOT BEEN CLAIMED B) THE APPELLANT IN THE RETURN AND ADDED BACK IN THE COMPUTATION. HENCE THE QUESTION OF DISALLOWANCE ONCE AGAIN TO THAT EXTENT DOES NOT ARISE. THE COMPUTATION OF THE AO SUFFERS FROM THE ABOVE ARITHMETICAL DEFECT. HENCE THE A DDITION MADE BY THE AO ONCE AGAIN OF THE PRELIMINARY EXPENSES IS NOT PROPER AS IT TANTAMOUNTS TO DOUBLE ADDITION OF RS. 26.94.389/ - IS THEREFORE DELETED. THE BALANCE EXPENSES CLAIMED BY THE APPELLANT AND DISALLOWED BY THE AO ON ACCOUNT OF NO BUSINESS ACT IVITY ARE AS FOLLOWS: HEAD OF EXPS. AMOUNT DISALLOWED (D) SALARY & RENT 3,24,034/ - (E) OPERATING. & ADMINISTRATIVE E XPS 20,14,358/ - (F) PRELIMINARY EXPS. 13,023/ - IN THE REMAND REPORT THE AO HAS STATED THAT NO BI L LS OR V OUCHERS WE RE PRODUCED FOR EXPENSES. THE APPELLANT IN THE REJOINDER HAS STATED ALL BILLS AND VOUCHERS WERE FURNISHED AT THE TIME OF ASSESSMENT. IN FACT THE AO DID NOT POINT OUT ANY DEFECT IN THE BILLS OR VOUCHERS. THERE WAS NO ISSUE REGARDING THE GENUINENESS OF THE 5 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 5 EXPENSES. THE ONLY GROUND FOR DISALLOWANCE WAS THAT NO BUSINESS ACTIVITY HAD COMMENCED. THE CASE OF THE AO FOR DISALLOWING THESE EXPENSES WAS THAT NO BUSINESS ACTIVITY WAS CARRIED OUT BY THE APPELLANT DURING THE RELEVANT PREVIOUS YEAR. IN THIS REGARD IT HAS BEEN SUBMITTED THAT THE APPELLANT HAD DONE THE FOLLOWING: TAKEN OFFICE ON LEASE. STAFF & EMPLOYEES WERE RECRUITED. MR. RAVINDRA WAS APPOINTED AS PRODUCT MARKETING CONSULTANT. MR. C. RAMA KRISHNA WAS APP OINTED AS A LIAISONING OFFICER. NILUM MARKETING ENTERPRISES PVL. LID WAS APPOINTED A' SALES REPRESENTATIVE. THEREFORE IT IS THE CONTENTION OF THE ASSESSEE THAT THE BUSINESS WAS DULL, SET UP. THE MAIN OBJECTS OF THE APPELLANT COMPANY AS PER THE MEMORA NDUM ARE: 1. TO CA RRY ON BUSINESS AS MANUFACTURER. PROCESSOR. IMPORTER, EXPORTER AND GENERALLY TO DEAF IN RAIL CLIPS SUITABLE FOR USE ON CONCRETE, STET'! AND TIMBER SLEEPERS, SLAB TRACK FOR LIGHT RAIL METROS AND OTHER RAIL FASTENING APPLICATIONS AND ELAS TOMERIC RAIL PADS. INSULATORS, CASE IRON SHOULDERS AND OTHER PRODUCTS, CONNECTED WITH THE ESTABLISHMENT AND MAINTENANCE OF RAILWAYS. 2. TO CARR Y ON THE BUSINESS OF MANUFACTURERS. MOULDERS. EXTRUDERS. PROCESSORS. A SSEMBLERS , FABRICATORS OF NUTS, BOLTS, AL L TYPES OF RAIL FASTENING S AND OTHER INDUSTRIAL FASTENERS AND TO MANUFACTURE. TREAT, PREPARE. REFORM, CONVERT. MAKE. FORM, MOULD, REMOULD AND RENDER MARKETABLE SCREWS. WOOD S CREWS, COACH SCREWS. R IVETS , BOLTS. STEEL HALLS. PANEL PINS. WIRE NAILS AND ALLIE D PRODUCTS , SPARE PARTS F OR MACHINERIES, DEVICES. A PP ARATUSES, . ENGINES AND FOR THEIR ALLIED USE AS ORIGINAL EQUIPMENT OR OTHERWISE AND TO CURRY ON THE BUSINESS OF TRADING, IMPORTING. BUYING. SELLING. DISTRIBUTING. PROCESSING ALL KINDS OF ABOVE PRODUCTS IN INDIA . FROM THE E ABOVE IT CAN BE SEEN THAT THE BUSINESS OF THE APPELLANT IS TO DEAL MAINLY IN RAIL CLIPS AND RAIL FASTENINGS. THE CUSTOMER IN THIS CASE PRIMARILY WOULD BE 6 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 6 THE INDIAN RAILWAYS. AS REGARDS NO REVENUE FROM OPERATIONS OFFERED IS THAT THE RAILWAY AUTHORITIES WERE NOT CONSIDERING THE TENDERS OF THE APPELLANT AND HENCE A PETITION WAS FILED BY THEM AGAINST THE RAILWAYS BEFORE THE COMPETITOR CONTROLLERS OF INDIA. F URTHER IT HAS BEEN STATED SALE COULD BE EFFECTED TILL THE DISPOSAL OF WRIT PETITION NO. ( C) 3351 OF 20 11 BY ORDER DTD. 26/09/2012 BY THE HONBLE DELHI HIGH COURT. IT IS ONLY AFTER THE DISPOSAL OF THE WRIT PETITION THE COMPANY WAS ABLE TO START ACTUAL SA LES. ACCORDINGLY, IT HAS BEEN ARGUED BY THEM THAT THE APPELLANT HAD S ET UP HIS BUSINESS AND ALL INTEGRATED ACTIVITIES FOR THE SAME HAD BEEN FULLY CARRIED OUT. IN THIS CONTEXT THE APPELLANT HAS PLACED RELIANCE ON THE FOLLOWING DECISIONS: I. CIT VRS. WESTE RN INDIA SEA FOOD PVT, LTD { I 99 - ITR - 777) (GUJ). II . PRAM CONDUCTORS CASE 108 - ITR - 654 (GUJ) III. . CIT YRS. SQRABLI MANAGEMENT CO, (19~ - ITR - 151) IV. HOTEL ALANKAR YRS. CIT - 133 - ITR - 866 (GUJ) V. WESTERN INDIA YEGITABLE PRODUCTS.26 - ITR - 151 {BAN) IN THE CASE OF WESTERN INDIA SEA FOOD PVT. LTD (SUPRA) THE ISSUE BEFORE THE LION 'BLE HIGH COURT WAS WHETHER THE BUSINESS OF PROCESSING OF MARINE PRODUCTS COULD BE DEEMED TO HAVE BEEN SET UP WHEN GODOWN WAS PROCURED BY THE APPELLANT FOR PROCESSING OF MARINE PRODU CTS. THE LION 'BLE HIGH COURT ON THE ISSUE OF SETTING UP THE BUSINESS AND ALLOW ABILITY OF EXPENDITURE HAS HELD AS FOLLOW S: 10. IN THE LIGHT OF THE AFORESAID SETTLED LEGAL POSITION. THEREFORE . IT IS EASY TO VISUALIS E THAT FOR SE TTING UP OF BUSINESS OF PROCESSING MARINE PRODUCTS. THE ASSESSEE , DURING THE ASSESSMENT YEAR IN QUESTION , HAD TO MAKE ALL PREPARATIONS AND HAD ALSO TO PROVIDE ON SPOT. NECESSARY INFRASTRUCTURE. EVEN CONCEDING THAT ENTERING INTO ADVANCE CONTRACTS WITH FISHERMEN FOR CO LLECTION OFFISH DURING THE MONSOAN SEASON MAY NOT BE TAKEN AS FIRST STEP TOWARDS SETTING LIP OF BUSINESS, AT LEASTFROM 15 - 8 - /97/1 WHEN THE ASSESSEE ACQUIRED GODOWN WHERE THE PROCESSING OF MARINE PRODUCTS COULD START WHEN FISH BECAME AVAILABLE ALIA 1I10NS( )0I/. IT CAN HE SAID THAT THAT WAS THE STARTING POINT OF SETTING LIP OF BUSINESS OF PROCESSING MARINE PRODUCTS. ACTUAL ARRIVAL OF FISH LATER ON WOULD NOT POSTPONE THE SETTING LIP OF SUCH BUSINESS. THE TRIBUNAL WAS. T HEREFORE , RIGHT IN CONCURRING WITH THE V IEW OF THE AAC THAT EXPENDITURE INCURRED B Y THE ASSESSEE AFTER 15 - 8 - 19 70 AND BEFORE 6 - 1 0 - 7 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 7 19 7 0 WHEN COLLECTION OF FISH WAS 10 ACTUALLY START, ('(/11 HE TREATED TO HT' BUSINESS EXPENDITURE AND WOULD GEL COVERED UNDER SECTION 37. IN THE DECISION ABOVE THE H ONBLE HIGH C OURT HAS HELD THAT THERE 1L1A~ BE INTERREGNUM BETWEEN THE SETTING UP OF THE BUSINESS AND THE COMMENCEMENT OF THE BUSINESS. THE HIGH COURT HAS FURTHER HELD THAT ALL EXPENSES AFTER SETTING UP OF THE BUSINESS ARE TO BE ALLOWED AS REVENUE EXPENDIT URE. IN VIEW OR THE ABOVE, THE CLAIM FOR BALANCE EXPENDITURE OF RS. 23,51,415/ - ( EXCLUDING PRELIMINARY EXPENDITURE SUO MOTO DISALLOWED BY THE APPELLANT) IS HEREBY ALLOWED. 7 . THERE IS NO DISPUTE THAT THE IMPUGNED SUM INCLUDES ASSESSEES DEPRECIATION CLA IM OF RS.34,281/ - AND OTHER EXPENSES OF RS.23,38,393/ - . THIS LATTER FIGURE MAINLY COMPROMISE S OF SALARY, RENT, OPERATING AS WELL S PRELIMINARY EXPENSES. THE R EVENUES CASE IS THAT THE SAME HAD RIGHTLY BEEN DISALLOWED DURING THE COURSE OF ASSESSMENT AS ASSESSEE HAS NO T COMMENCED ITS BUSINESS . I FIND NO MERIT IN R EVENUES INSTANT ARGUMENTS AS IT HAS COM E ON RECORD THAT ASSESSEE HAD DULY SET UP ITS BUSINESS AND FURTHER CARRIED OUT ALL INTEGRATED ACTIVITIES. THE SOLE REASON FOR NOT GETTING ANY ORDER APPEA RS TO BE PENDENCY OF VARIOUS LITIGATIONS (SUPRA). I THEREFORE IN THESE FACTS AND CIRCUMSTANCES OF THE VIEW THAT THE CIT(A) HAS RIGHTLY RELIED ON THE ABOVE CASE LAWS (SUPRA) TO ALLOW ASSESSEES IMPUGNED CLAIM OF BUSINESS EXPENDITURE. THE REVENUES THIRD I DENTICAL SUBSTANTIVE GROUNDS FAILS IN ALL THREE CASES . 8 . LASTLY COMES R EVENUES IDENTICAL SECOND SUBSTANTIVE GROUND IN A/YS 2008 - 09 AND 2009 - 10 SEEKING TO REVIVE PREMATURE FD INTEREST ADDITION OF RS.10,13,992/ - MADE IN THE COURSE OF ASSESSMENT AND DEL ETED IN CIT(A)S ORDER. I NOTICED AT THE TIME OF HEARING THAT THE CIT(A) HAS TAKEN NOTE OF THE ASSESSING OFFICERS REMAND REPORT AS UNDER: - 8 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 8 DECISION: ON PERUSAL OF THE ASSESSMENT ORDER IT IS OBSERVED THAT THE AO IN THE COMPUTATION OF INCOME HAS ADDED RS.27,57,953/ - ON THIS GROUND. HOWEVER, IN THE BODY OF THE ASSESSMENT ORDER IN PARA 2(B) THE AO HAS DISCUSSED THE AMOUNT OF RS.10,13,992/ - . THE CORRECT FIGURE AS PER THE REMAND REPORT OF THE AO IS RS. 10,13,992/ - . HENCE, THIS ISSUE IS DISCUSSED WITH REFERE NCE TO THE AMOUNT OF RS.10,13,992/ - . THE ISSUE IS REGARDING ADDITION OF RS.10,13,992/ - BEING UNEXPLAINED CASH DEPOSIT U/S. 68 OF THE ACT. THE AO IN THE ASSESSMENT ORDER OBSERVED THAT THE APPELLANT HAS RECEIVED RS.10,13,992/ - ON ACCOUNT OF PREMATURE ENCA SHMENT OF FDR AND AS THE APPELLANT FAILED TO PROVE THE SOURCE OF INVESTMENT THE AMOUNT OF RS.10,13,992/ - IS UNEXPLAINED AND THEREFORE ADDED TO THE TOTAL INCOME OF THE APPELLANT BY THE AO. THE A/R OF THE APPELLANT HAS SUBMITTED THAT THE APPELLANT HAD MADE TWO FDS OF RS.5,00.000/ - AND THE SAME AMOUNT OF RS. 10 LACS HAS BEEN DEBITED FROM THE ASSESSEES BANK ACCOUNT ON 10.08.2007. FURTHER THE A/R HAS SUBMITTED THAT THE COPIES OF BANK STATEMENTS WERE ALSO FILED BEFORE THE AO. THESE TWO FDS WERE PREMATURELY ENCA SHED ON 16.10.2018 AND 10.01.20108. THE INTEREST ACCRUED ON FDS OF RS. 10 LACS IS RS. 17,623/ - . TDS OF RS.3,631/ - HAS BEEN DULY DEDUCTED AND THE ENCASHED AMOUNT OF RS. 10,13,992/ - IS REFLECTED IN THE BANK ACCOUNT OF APPELLANT ON 10.01.2018. THE CLAIM OF TH E APPELLANT WAS FORWARDED TO THE AO FOR HIS COMMENTS. THE AO IN HIS REMAND REPORT ACCEPTED THE ARITHMETICAL ERROR IN MAKING THE ADDITION OF RS.27,57,953/ - . FURTHER HE HAS BEEN CONTENDED THAT THE TRANSACTION ARE VERIFIABLE FROM BANK STATEMENTS FURNISHED DURING THE COURSE OF ASSESSMENT PROCEEDINGS. IN THE REMAND REPORT THE AO HAS RAISED THE CONTENTION THAT THE FD HAS NOT BEEN REFLECTED IN THE BALANCE SHEET. IN THIS CONTEXT, IT IS OBSERVED THAT TWO FDS OF RS5 LAKH EACH MADE ON 10.08.2007. THEY WERE ENCCASHED PREMATURELY ON 16.10.2007 AND 10.01.2008 RESPECTIVELY. HENCE IT IS ARGUED THAT THEY HAVE NOT BEEN REFLECTED IN THE BALANCE SHEET. MOREOVER, THE BANK STATEMENTS WERE BEFORE THE AO IN WHICH NO DISCREPANC Y HAS BEE N POINTED OUT. AS THE THESE TWO FDS HAVE BEEN WITHDRAWAL PREMATURELY THE ADDITION MADE BY THE AO OF RS.27,57,953/ - ( AS PER THE COMPUTATION INSTEAD OF RS.10,13,992/ - ) IS HEREBY DELETED. 9 ITA NO S 245 247/KOL/2019 - SMC - JM M/S. PANDROL RAHEE TECHNOLOGIES P.LTD 9 IT EMERGES FROM A PERUSAL OF ABOVE EXTRACTED FINDINGS THAT THE AO HAS HELD THE IMPUGNED TRANSACTION AS DULY VERIFIABLE. IT FURTHER TRANSPIRES THAT THE ASSESSEES HA D NOT PREMATURE EXITED FD S C OMING FROM ITS BANK ACCOUNT ONLY(SUPRA). I THEREFORE CONCLUDE THAT THE CIT(A) HAS RIGHTLY DELETED THE IMPUGNED ADDI TION IN THE GIVEN FACTS AND CIRCUMSTANCES. THIS R EVENUES LAST SUBSTANTIVE GROUND IS ALSO DECLINED. 9 . TH ESE THREE REVENUES APPEALS ARE DISMISSED IN ABOVE TERMS . ORDER PRONOUNCED IN THE COURT ON 26 - 06 - 2019 SD/ - [ S.S.GODARA ] JUDICIAL MEMBER DATED : 26 - 0 6 - 2019 **PRADIP, SR. PS C OPY OF THE ORDER FORWARDED TO: COPY OF THE ORDER FORWARDED TO: 1. APP ELLANT / DEPARTMENT: ITO, WARD 8(3), AAYKAR BHAWAN,P - 7 CHOWRINGHEE SQ., 5 TH FL, KOLKATA - 69. 2 RESPONDENT/ ASSESSEE: M/S. PANDROL RAHEE TECHNOLOGIES P.LTD FLAT - 1C, 1 ST FL., 4 HO CHI MINH, KOLKATA - 71. 3. CIT, 4. CIT(A), KOLKATA 5. DR, KOLKATA BENCHES, KOLKATA **PP/SPS TRUE COPY BY BY ORDER ASSISTANT REGISTRAR ITAT KOLKATA