Badri Prasad Ram Gopal Dall Mill, Alwar V. ITO, Alwar

ITA 262/JPR/2014

• Counselvise Citation: [2016] 133 COUNSELVISE.COM (IT) 5350 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 11 month(s) 15 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 18-03-2016
• Appeal Filed By: Assessee
• Order Result: Partly Allowed
• Bench Allotted: B
• Assessment Year: 1998-1999
• Appeal Filed On: 03-04-2014
• Result in Favour of: Partly Allowed
• Court: TRIBUNAL
• Department Lawyers: SHRIO P BATEJA CIT DHK
• Keywords: Unexplained cash credit; Opportunity of being heard; Peak credit; Question of law; Revenue expenditure
• Section: 143(3); 133A; 131; 68; 148; 144; 2

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCHE S, JAIPUR JH VH-VKJ-EHUK] YS[KK LNL; ,OA JH YFYR DQEKJ] U;KF; D LNL; DS LE{K BEFORE: SHRI T.R.MEENA, AM & SHRI LALIET KUMAR, JM VK;DJ VIHY LA-@ ITA NO. 262/JP/2014 & 492/JP/2013 FU/KZKJ.K O'K Z @ ASSTT. YEAR : 1998-99 & 1999-2000. BADRI PRASAD RAM GOPAL DALL MILL, 18, CLOCK TOWER, ALWAR. CUKE VS. THE INCOME-TAX OFFICER, WARD 2(2), ALWAR. LFKK;H YS[KK LA - @THVKBZVKJ LA - @ PAN/GIR NO. AAEFB 3625 L VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ LS@ ASSESSEE BY : SHRI RAJEEV SOGANI (C.A.) JKTLO DH VKSJ LS@ REVENUE BY : SHRIO.P. BATEJA (ADDL.CIT) LQUOKBZ DH RKJH[K@ DATE OF HEARING : 27.01.2016. ?KKS'K .KK DH RKJH[K @ DATE OF PRONOUNCEMENT : 18/02/2016. VKNS'K@ ORDER PER SHRI T.R. MEENA, A.M. THESE ARE TWO APPEALS FILED BY THE ASSESSEE EMANAT ING FROM THE ORDER OF LD. CIT (A), ALWAR DATED 24.02.2014 FOR THE A.YS. 1998-99 A ND 1999-2000. THE GROUNDS RAISED IN THE APPEALS ARE AS UNDER :- ITA NO. 262/JP/2014 A.Y. 1998-99 : 1. THAT THE LD. AO HAS ERRED IN LAW AS WELL AS ON T HE FACTS AND CIRCUMSTANCES OF THE CASE IN GIVING A FINDING IN TH E ASSESSMENT ORDER THAT THE ASSESSEE HAS ACCEPTED THE LOAN DURING THE YEAR ON THE CONTRARY THERE IS NO ACCEPTANCE OF LOAN, BUT THE AS SESSEE HAS GIVEN THE LOAN, WHICH IS ESTABLISHED FROM THE COPY OF THE PEAK WORKING SUBMITTED DURING THE CURSE OF ASSESSMENT PROCEEDING S, WHICH 2 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL REMAINED UNCONTROVERTED BY THE AO AND LD. CIT (A) E RRED IN SUSTAINING THE SAME. 2. THAT THE LD. AO HAS ERRED IN LAW AS WELL AS ON T HE FACTS AND CIRCUMSTANCES OF THE CASE IN ADDING A SUM OF RS. 4, 50,000/- BEING THE PEAK CREDIT UNDER SECTION 68 OF THE I.TAX ACT 1961, WHEREAS THE FACTS REMAINS THAT THERE IS NO PEAK CREDIT, ON THE CONTRA RY THERE IS A DEBIT BALANCE GIVEN BY THE ASSESSEE OUT OF HIS FIRMS REGU LAR CASH BALANCE, THEREFORE, THE NO ADDITION DESERVES TO HAVE BEEN MA DE AND LD. CIT (A) ERRED IN SUSTAINING THE SAME. 3. THAT THE LD. AO HAS ERRED IN LAW AS WELL AS ON T HE FACTS AND CIRCUMSTANCES OF THE CASE IN MAKING AN ADDITION OF RS. 20,000/- BEING THE INTEREST PAID ON UNEXPLAINED CASH CREDITS, WHER EAS THE FACTS REMAINS THAT THERE IS NO PEAK CASH CREDIT AND LD. C IT (A) ERRED IN SUSTAINING THE SAME. ITA NO. 492/JP/2013 A.Y. 1999-2000 : 1. THAT THE LD. AO HAS ERRED IN LAW S WELL AS ON TH E FACTS AND CIRCUMSTANCES OF THE CASE IN NOT ALLOWING THE SET O FF OF TRADING ADDITION IN CHANA DAL OF RS. 69676.00 IN GUWAR OF RS. 2442.0 0 AND UNEXPLAINED PEAK CASH CREDIT OF RS. 19,60,000/- AGA INST THE INVESTMENT IN PURCHASES OF RS. 20,90,604/- AND LD. CIT (APPEAL S), HAS ERRED IN SUSTAINING THE ACTION OF THE AO WITH REFERENCE TO R S. 19,60,000/-. 2. THE AO OBSERVED THAT THE ASSESSEE IS A PARTNERSH IP FIRM ENGAGED IN THE BUSINESS OF TRADING OF CHAN DAL, CHANA CHURI AND CH ANA CHILKA DURING THE YEAR. A SURVEY U/S 133A OF I.T. ACT WAS CARRIED OUT AT THE BUSINESS PREMISES OF THE ASSESSEE ON 05.03.1999. DURING THE COURSE OF SURVEY PROCEEDINGS IT WAS FOUND THAT THE ASSESSEE WAS IN HABIT OF TAKING LOANS WHICH WERE NOT RECORDE D IN ITS REGULAR BOOKS. DURING THE COURSE OF SURVEY A GEETA DAYANANDINI DIARY (1998 AD DITION) WAS FOUND DURING THE COURSE OF SURVEY WHEREIN SUCH LOANS CREDITORS AND D EBTORS WERE RECORDED FOR THE PERIOD 1.01.1998 TO 31.12.1998. IT WAS ALSO NOTICED THAT T HE ENTRIES RECORDED IN THE GEETA DAYANANDINI DAIRY REPRESENTED THE UNDISCLOSED LOAN CREDITORS WHICH WAS NOT DISCLOSED 3 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL IN THE RETURN OF INCOME FILED FOR THE A.Y. 1998-99. THEREAFTER ACTION U/S 148 WAS INITIATED VIDE NOTICE DATED 28.03.2003 AND COMPLETE THE ASSES SMENT PROCEEDING. THE ASSESSEE FAILED TO COMPLY WITH THE NOTICE ISSUED U/S 148/142 (1), THEREFORE, ASSESSMENT WAS COMPLETED AT ASSESSED INCOME OF RS. 1,09,81,916/- U NDER THE PROVISION OF SECTION 144 OF THE INCOME TAX ACT, 1961 ON 31.01.2004 BY MAKING THE TRADING ADDITION OF RS. 19,399/-, UNEXPLAINED CASH CREDITS RS. 1,09,45,000/ - U/S 68 OF THE ACT. 2.1. HE FURTHER OBSERVED THAT AGGRIEVED BY THE ORDE R OF THE AO, THE ASSESSEE FILED A PETITION U/S 264 OF THE INCOME TAX ACT, 1961 REQUES TING TO SET ASIDE THE ORDER OF THE AO. THE CIT ALWAR VIDE HIS ORDER DATED 16.03.2004 SET A SIDE THE ASSESSMENT ORDER TO BE MADE DENOVO AFTER PROVIDING PROPER OPPORTUNITY TO T HE ASSESSEE ON THE PROPOSED ADDITIONS. IN THE MEANWHILE THE ASSESSEE WENT IN AP PEAL BEFORE THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR AND THE TRIBUNAL DIRECTE D THE ASSESSEE TO MAKE THE ADDITION ON THE BASIS OF PEAK THEORY. THEREAFTER THE AO HAD MADE REASSESSMENT U/S 148/264/143(3) AND FIND OUT THAT THE MONEY INTRODUC ED BY THE ASSESSEE WAS NOT HIS OWN MONEY UNDER THE GARB OF BORROWING IN CASH. THER EFORE HE HAD NOT ACCEPTED THE CONTENTION OF THE ASSESSEE THAT THESE ARE ACTUAL BO RROWINGS. THE AO ALSO EXAMINED ALL PARTIES BY CALLING THEM BY ISSUING NOTICE UNDER SEC TION 131. ALL THE PARTIES HAVE DENIED IN HAVING GIVEN ANY CASH LOAN TO THE ASSESSEE. HOW EVER, IN COMPLIANCE TO THE DIRECTIONS OF THE TRIBUNAL THE AO WORKED OUT THE PE AK FOR THE YEAR UNDER CONSIDERATION AND MADE THE ADDITION. THE AO WORKED OUT THE PEAK A MOUNT AT RS. 52,30,000/- AND AS SUCH ADDITION WAS MADE ON THIS ACCOUNT. FURTHER ADD ITION OF RS. 3,49,844/- WAS MADE ON ACCOUNT OF ALLEGED INTEREST PAID ON THE CASH CRE DIT OF RS. 52,30,000/-, TRADING ADDITION OF RS. 19,399/- AND COMPLETED THE ASSESSME NT UNDER SECTION 143(3)/148/264 OF 4 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL THE INCOME TAX ACT, 1961, AT TOTAL INCOME OF RS. 56 ,16,760/- ON 30.03.2005. THE ASSESSMENT ORDER IN THIS CASE WAS PASSED AFTER ADOP TING THE PEAK CREDIT IN TERMS OF THE DECISION OF HONBLE RAJASTHAN HIGH COURT IN THE CAS E OF COMMISSIONER OF INCOME TAX VS. ISHWAR DASS MUTHA, 270 ITR 597. THEREAFTER THE ASSESSEE HAS PREFERRED AN APPEAL BEFORE LD. CIT (A), ALWAR. 2.2. HE FURTHER OBSERVED THAT THE LD. CIT (A), ALWA R IN HIS APPEAL ORDER NO. 138/2005- 2006 DATED 28.03.2007 CONFIRMED THE ADDITION OF RS. 52,30,000/- AND INTEREST THEREIN AT RS. 3,49,844/-. THEREAFTER FURTHER APPEAL WAS FILED AGAINST THE ORDER OF LD. CIT (APPEALS)S ORDER DATED 28.03.2007 BEFORE THE INCOM E TAX APPELLATE TRIBUNAL, JAIPUR BENCH, JAIPUR. 2.3. SUBSEQUENTLY THE INCOME TAX APPELLATE TRIBUNAL , JAIPUR BENCH, JAIPUR IN ITA NO. 664 & 609/JP/2007 DATED PASSED THE ORDER ON 30.12.2 010. IN THE ORDER THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH, JAIPUR HAS DIRECT ED THAT THE AMOUNT OF ADDITION HAS TO BE MADE ON THE BASIS OF PEAK CREDIT BASIS. THEREFOR E THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENCH, JAIPUR SET ASIDE THE MATTER TO THE AO TO ASCERTAIN THE CORRECT AMOUNT OF ADDITION ON THE BASIS OF PEAK CREDIT. 2.4. THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENC H, JAIPUR HAD FURTHER DIRECTED TO EXAMINE THE ADDITION IN RESPECT OF ALLEGED INTEREST AFRESH IF THE AO IS OF THE VIEW THAT THIS AMOUNT IS NOT OF THE ASSESSEE AND NOT TAKEN FR OM ANY OTHER PARTY. THE ISSUE WAS ALSO SENT BACK TO THE AO TO CONSIDER AFRESH. 2.5. AS PER DIRECTION GIVEN BY THE ITAT, JAIPUR BEN CH, JAIPUR IN CASE OF ASSESSEE, THE AO ISSUED NOTICE UNDER SECTION 143(2) OF THE ACT AN D DECIDED THE CASE AS PER THE DIRECTION OF THE ITAT. THE AO GAVE THE REASONABLE OPPORTUNITY OF BEING HEARD ON PEAK 5 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL CREDIT WORKED OUT AT RS. 52,30,000/- FOR THE FINANC IAL YEAR 1997-98. THE LD. A/R ALSO REPLIED VIDE LETTER DATED 28.12.2011 WHICH HAS BEEN REPRODUCED BY THE AO ON PAGE 3 OF THE ASSESSMENT ORDER. THE AO ALSO ISSUED SUMMON U/ S 131 TO ONE OF THE PARTNERS, NAMELY SHRI ASHOK KUMAR GUPTA AND STATEMENT UNDER S ECTION 131 WAS RECORDED BY THE AO AND SAME HAS BEEN REPRODUCED AT PAGES 3, 4 & 5 O F THE ASSESSMENT ORDER. AFTER CONSIDERING THE ASSESSEES SUBMISSION AND STATEMENT , IT HAS BEEN HELD THAT ASSESSEE HAD ACCEPTED FRESH LOAN DIRECT AND THROUGH BADLA DURING THE PERIOD FROM 01.01.1998 TO 31.03.1998 WHICH ARE RECORDED IN GEETA DAYANANDINI DIARY. FOLLOWING THE DECISION AND DIRECTION OF THE ITAT JAIPUR BENCH JAIPUR, HE CONSI DERED THE PEAK OF RS. 4,50,000/- AFTER TAKING INTO ACCOUNT ALL THE BADLA ENTRIES OF DIARY FOR THE PERIOD 01.01.1998 TO31.03.1998. THE ASSESSEE HAS ADMITTED THE CALCUL ATION OF PEAK WORK OUT AT RS. 4,50,000/- AS SUCH. ACCORDINGLY SAME WAS TREATED AS UNDISCLOSED INCOME U/S 68 OF THE IT ACT AT RS. 4,50,000/-. FURTHER, THE AO ALSO EST IMATED THE INTEREST ON THIS PEAK AMOUNT AT RS. 20,000/- WHICH WAS ALSO ADDED TO THE INCOME OF THE ASSESSEE. 3. BEING AGGRIEVED BY THE ORDER OF THE AO, ASSESSEE CARRIED THE MATTER BEFORE LD. CIT (A) WHO HAD CONFIRMED THE ADDITION BY OBSERVING AS UNDER :- 4.7. I HAVE GONE THROUGH WRITTEN SUBMISSIONS FILE D BY THE APPELLANT AND DO NOT FIND ANY LOGIC OR RATIONAL IN THE ARGUMENT T HAT THE PEAK CREDIT WORKED OUT BY THE AO AT RS. 4,50,000/- MAY BE DIS-R EGARDED. THE PRESENT THEORY OF THE WHOLE CREDIT BEING GIVEN OUT OF THE C ASH BALANCE AVAILABLE IN THE REGULAR BOOKS OF ACCOUNTS IS NOT ACCEPTABLE AS IT HAD NEVER BEEN THE STAND OF THE APPELLANT IN THE LAST 10 YEARS. THIS P EAK CREDIT WAS WORKED OUT BY THE AO AFTER EXAMINATION OF THE APPELLANT HI MSELF, AND THUS THE PRESENT ARGUMENT IS NOTHING BUT CHANGE OF STAND ON THE PART OF THE APPELLANT. THIS KIND OF SHIFTING OF STANCE ON THE P ART OF APPELLANT IS WITH A 6 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL VIEW TO DEFEAT THE PROCESS OF LAW AS WOULD BE CLEAR FROM THE SEQUENCE OF EVENTS AS STATED IN PARA 4.1 ABOVE. ACCORDINGLY, I HAVE NO HESITATION TO CONFIRM THE ADDITION OF RS. 4,50,000/- MADE BY THE AO U/S 68 OF THE IT ACT. THE LD. CIT (A) HAS ALSO CONFIRMED THE INTEREST OF RS. 20,000/- ON PEAK AMOUNT. 4. NOW THE ASSESSEE IS BEFORE US. 4.1. THE LD. A/R FOR THE ASSESSEE SUBMITTED THAT TH ERE WAS A SURVEY UNDER SECTION 133A ON 5.3.1999 AND DURING THE COURSE OF SURVEY CA SH OF RS. 33,699/-, GEETA DAYANANDINI DIARY WAS FOUND IN WHICH TRANSACTIONS O F BORROWING/LENDINGS WERE RECORDED. THE LD. A/R HAS ALSO DRAWN OUR ATTENTION ON THE GROUND RAISED BEFORE THE ITAT THAT ASSESSEE NEVER ACCEPTED THE LOAN TAKEN BU T IT IS CONTRARY THAT ASSESSEE HAD GIVEN LOAN DURING THE YEAR AND PEAK CREDIT OF RS. 4 ,50,000/-. THE LD. CIT (A) BY WAY OF REFERENCE TO THE PEAK WORKING DONE ON THE BASIS OF ENTRIES IN THE IMPOUNDED DIARY THAT THE BALANCE IS DEBIT. IT WAS ALSO EXPLAINED THAT ON THAT PARTICULAR DAY THE ASSESSEE FIRM HAD SUFFICIENT CASH IN ITS BOOKS OF ACCOUNTS, OUT O F WHICH SOURCE, THE SAID ADVANCES WERE GIVEN. IT WAS ALSO EXPLAINED THAT IT WAS ONLY LAPSE IN RECORDING THE ENTRY IN THE REGULAR BOOKS DUE TO THIS ERROR THERE WAS CASH IN H AND AVAILABLE IN THE REGULAR BOOKS AND DEBIT BALANCE APPEARED IN THE DIARY. IF BOTH AR E SEEN TOGETHER, THE SOURCE OF DEBIT BALANCE IS FULLY EXPLAINED AND SUBSTANTIATED. THE LD. CIT (A) HAD NOT EXPRESSED ANY OPINION ON ASSESSEES CLAIM THAT THESE ARE THE LOAN S GIVEN, AND NOT TAKEN. THE DIARY HAD A NUMBER OF PAGES CONTAINING ALMOST NUMEROUS EN TRIES. THE PEAK CALCULATION WAS CUMBERSOME. FOR THIS REASON, THE PEAK CALCULATION KEPT ON CHANGING AT VARIOUS LEVELS. EVEN THE ITAT SET ASIDE THE MATTER IN FIRST ROUND T O THE FILE OF THE AO WITH THE DIRECTION TO 7 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL CALCULATE IT CORRECTLY. THUS, PEAK WAS CORRECTLY C ALCULATED FOR THE FIRST TIME BY THE AO IN ORDER DATED 29.12.2011. BEFORE THE LD. CIT (A), THE ASSESSEE SUBMITTED VIDE LETTER DATED 28.12.2011 THAT PEAK WORKING OF THE ENTRIES AS APPE ARING IN THE GEETA DAYANANDINI DIARY AND PERTAINING TO THE A.Y. 1998-99, THERE DID NOT APPEAR ANY PEAK CREDIT. ON THE CONTRARY, THERE WAS A DEBIT BALANCE ON THE ALL OCCA SION, THEREFORE, NO ADDITION IS CALLED FOR DURING THE YEAR UNDER CONSIDERATION ON ACCOUNT OF PEAK CREDIT WORKING. IN APPELLATE STAGE ALSO THIS WAS THE FIRST ARGUMENT BEFORE LD. C IT (A). THE LD. CIT (A) HELD THAT THIS WAS THE CHANGE IN STAND OF THE ASSESSEE BUT THE LD. A/R ARGUED THAT EVEN TO CALCULATE THE REAL INCOME, THE CHANGE OF STAND IS ALLOWED BY THE VARIOUS HIGH COURTS FOR WHICH HE CITED NUMBER OF DECISIONS IN SUPPORT OF HIS SUBMISS ION. THE CASES ARE AS UNDER :- CIT VS. JUTE CORPORATION, 187 ITR 688 (SC) NATIONAL THERMAL POWER CO. LTD. VS. CIT 229 ITR 3 83 (SC) CIT VS. REWARI CENTRAL CO-OPERATIVE BANK LTD., 26 3 ITR 598 (P&H) CIT VS. KANPUR COAL SYNDICATE, 53 ITR 225 (SC) POPULAR AUTOMOBILES VS. CIT, 187 ITR 86 (KER.) THE RELEVANT QUESTION BEFORE THE COURT IS THAT WHAT EVER CLAIM MADE BY THE ASSESSEE IS SUBSTANTIATED FROM THE RECORD OR NOT. HE FURTHER R ELIED ON THE FOLLOWING CASES :- CIT VS. S. NELLIAPPAN, 66 ITR 722 (SC) AHMEDABAD ELECTRICITY CO. LTD VS. CIT, 199 ITR 35 1 (BOM.) CIT VS. JUTE CORPORATION, 187 ITR 688 (SC) CIT VS. BREACH CANDY SWIMMING BATH TRUST, 27 ITR 279 (BOM.) CIT VS. INDIAN EXPRESS (MADURAI) P. LTD. 140 ITR 7051 AND REQUESTED TO ALLOW THE APPEAL IN FAVOUR OF THE ASSESSEE. 4.2. AT THE OUTSET, THE LD. D/R SUPPORTED THE ORDER OF LD. CIT (A). 8 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL 5. IN A.Y. 1999-2000 THE ASSESSEES APPEAL IS AGAIN ST NOT ALLOWING THE SET OFF OF TRADING ADDITION IN CHANA DAL OF RS. 69,676/-, IN G UWAR OF RS. 2442/- AND UNEXPLAINED PEAK CREDIT OF RS. 19,60,000/- AGAINST THE INVESTME NT IN PURCHASE OF RS. 20,90,604/-. THE AO OBSERVED THAT THE ASSESSEE FILED RETURN ON 1 9.03.2002 AT (-) RS. 51,847/- (AFTER SET OFF OF SURRENDERED INCOME OF RS. 3,00,000/-). ASSESSMENT WAS COMPLETED UNDER SECTION 143(3) OF THE ACT AT RS. 16,80,271/- MAKING THE TRADING ADDITION OF RS. 69,676/- IN CHANA DAL, RS. 2,442/- IN GUWAR AND UNEXPLAINED CASH CREDIT OF RS. 16,60,000/- WHICH WAS SET ASIDE BY THE LD. CIT, ALWAR UNDER SEC TION 263 OF THE IT ACT VIDE ORDER DATED 22.12.2004 ON THE GROUND THAT AO HAD NOT CONS IDERED THE DECISION OF HONBLE RAJASTHAN HIGH COURT DELIVERED IN CASE OF SWAROOP C HAND KOJU RAM, 235 ITR 732 IN WHICH THEORY OF PEAK CREDIT WAS NOT ACCEPTED. 5.1. THE ASSESSEE FIRM PREFERRED APPEAL AGAINST THE ORDER OF LD. CIT BEFORE HONBLE ITAT JAIPUR BENCH JAIPUR. BUT IN THE MEANTI ME, THE AO HAD PASSED ORDER UNDER SEC. 143(3)/263 ON 24.03.2006 AFTER AFFORDING OPPOR TUNITY TO THE ASSESSEE AND COMPLETED THE ASSESSMENT AT THE TOTAL INCOME OF RS. 1,66,83,873/- MAKING THE TRADING ADDITION OF RS. 69,676/- IN CHANA DAL AND RS. 2,442 /- IN GUAR, RS. 20,90,604/- ON ACCOUNT OF INVESTMENT IN PURCHASE, RS. 2,434/- ON A CCOUNT SHORT CASH, RS. 1,27,34,000/- UNEXPLAINED CASH CREDITORS AND INTEREST TO CASH CRE DITORS OF RS 18,36,562/- AS SUCH. 5.2. THE ASSESSEE AGAIN PREFERRED APPEAL BEFORE LD. CIT (A), ALWAR AGAINST THE ORDER PASSED BY THE AO VIDE ORDER DATED 24.03.2006. BUT BEFORE DECIDING THE APPEAL BY LD. CIT (A), ALWAR, THE ITAT SET ASIDE THE ORDER OF LD. CIT, ALWAR VIDE ITS ORDER DATED 22.12.2006 WITH THE DIRECTION TO DECIDE THE ISSUE A FRESH KEEPING IN MIND THE DECISION 9 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL DELIVERED IN CASE OF CIT VS. ISHWAR DAS MUTHA OF HO NBLE JURISDICTIONAL HIGH COURT. THEREAFTER, THE LD. CIT (A) DECIDED THE APPEAL VIDE ORDER DATED 27.02.2007 AND ALLOWED RELIEF AND CONFIRMED THE ADDITION AS UNDER :- 1) TRADING ADDITION OF RS. 69,676/- & 2,442/- IN CH ANA DAL AND GWAR ACCOUNT HAVE BEEN CONFIRMED AS SUCH. 2) ADDITION OF INVESTMENT IN PURCHASE RS. 20,90,605 /- HAS CONFIRMED. 3) ADDITION OF CASH SHORT RS. 2,435/- HAS DELETED. 4) GROUND OF UNEXPLAINED CASH CREDITORS OF RS. 1,27 ,34,000/- : THE LD. CIT (A) DIRECTED THE AO TO WORK OUT THE AMOUNT OF CREDI T OF DIARY GEETA DAYANANDINI 1998 KEEPING IN MIND THE DIRECTION OF HONBLE ITAT, JAIPUR BENCH, JAIPUR ND FOLLOW THE DECISION OF HONBLE RAJ ASTHAN HIGH COURT IN THE CASE OF CIT VS. ISHWAR DAS MUTHA 270 ITR 597. 5.3. AGAINST THE ORDER OF LD. CIT (A) DATED 27.02. 2007, THE ASSESSEE PREFERRED APPEAL BEFORE THE ITAT. THE AO AFTER CONSIDERING T HE ITAT DECISION DATED 22.12.2006, COMPLETED THE ASSESSMENT PROCEEDINGS U/S 143(3)/253 ON 18.01.2007 BY MAKING THE FOLLOWING ADDITIONS :- 1) TRADING ADDITION IN CHANA DAL RS. 69,679/- 2) TRADING ADDITION IN GWAR RS. 2,442/- 3) UNEXPLAINED CASH CREDIT RS. 16,60,000/- 4) INVESTMENT IN PURCHASES AS DISCUSSED ABOVE AND CONFIRMED BY CIT (A) RS. 20,90,604/- 5) INTEREST TO CASH CREDITORS RS. 3,52,800/- THE ASSESSEE AGAIN FILED APPEAL BEFORE LD. CIT (A), ALWAR ON THE GROUND OF ADDITION MADE ON ACCOUNT OF UNEXPLAINED CASH CREDIT ENTRIES, INTEREST PAID THERETO BUT BEFORE DECIDING THE APPEAL BY LD. CIT (A), ALWAR, THE ITAT SET ASIDE THE ORDER DATED 24.03.2006 PASSED BY THE AO AND DIRECTED TO GO BACK TO CONSIDE R THE SUBMISSIONS MADE BY THE ASSESSEE AFRESH AND THEN PASS A FRESH ORDER ON THE ISSUE OF CASH CREDIT. THE ITAT HAS OBSERVED THAT THERE IS NO DISPUTE THAT THE AMOUNT O F ADDITION HAS BEEN WORKED OUT ON 10 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL ACCOUNT OF PEAK CREDIT ON THE BASIS OF DIARY FOUND AND ADDITION HAS BEEN MADE ON THE BASIS PEAK CREDIT. AS SUCH THE MATTER WAS SET ASID E TO THE AO TO ASCERTAIN THE CORRECT AMOUNT OF ADDITION ON THE BASIS OF PEAK CREDIT AND AMOUNT OF INTEREST PAYMENT BE CONSIDERED AFRESH. THEREAFTER THE AO ISSUED VARIOUS NOTICES. THE ASSESSEE WAS FOUND NON-COOPERATIVE TO THE AO. FINALLY, HE SUMMONED ON E OF THE PARTNERS, NAMELY, ASHOK KUMAR GUPTA UNDER SECTION 131 ON 15.12.2011 BY FIXI NG DATE OF HEARING ON 20.12.2011. ON 29.12.2011 STATEMENT OF SHRI ASHOK KUMAR GUPTA W AS RECORDED UNDER SECTION 131 OF THE IT ACT. THE FACTS OF THE CASE ARE IDENTICAL TO A.Y. 1998-99 AS ON THE BASIS OF SURVEY CONDUCTED UNDER SECTION 133A, A DIARY GEETA DAYANANDINI 1998 WAS FOUND AND IMPOUNDED. IT WAS NOTICED BY THE AO ON THE BASIS O F TRANSACTIONS RECORDED IN THE DIARY THAT THE FIRM HAD TAKEN LOAN IN CASH FROM DIFFERENT PERSONS DURING THE PERIOD FROM 1.4.1998 TO 31.03.1999 AND PAID INTEREST THERETO. T HE ASSESSEE ADMITTED DURING THE ORIGINAL ASSESSMENT THAT CREDIT ENTRIES SHOWN IN TH E DIARY WERE NOT SHOWN IN REGULAR BOOKS OF ACCOUNT. TO GET VERIFIED THE CASH CREDITO RS BEFORE THE AO AS PER THE DIRECTION OF HONBLE ITAT, JAIPUR BENCH, DECISION DATED 30.12 .2010, THE ASSESSEE WAS ASKED TO EXPLAIN THE PEAK CALCULATED BY THE AO AT RS. 19.6 L ACS ON THE BASIS OF THIS DIARY. THE STATEMENT OF SHRI ASHOK KUMAR GUPTA HAS BEEN REPROD UCED BY THE AO AT PAGE 4 OF HIS ORDER. AFTER CONSIDERING THE ASSESSEES REPLY, THE AO HELD THAT THE PEAK WORKED OUT AS ON 03.12.1998 AT RS. 19.6 LACS PERTAINED TO A.Y. 19 99-2000 AND RS. 4,50,000/- AS ON 09.03.1998 PERTAINED TO A.Y. 1998-99. THE ASSESSEE HIMSELF ADMITTED THAT PEAK OF EARLIER YEAR UTILIZED UPTO 31.03.1998 FOR GIVING LO ANS AND NO POSITIVE BALANCE OF PREVIOUS YEAR WITH THE FIRM OF THE ASSESSEE. THE ASSESSEE F IRM HAD UTILIZED FUND OF EARLIER YEAR 1997-98 IE. RS. 4.5 LACS TO ISSUE FRESH LOAN IN SAI D YEAR. THE HIGHEST PEAK CREDIT OF RS. 11 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL 19.6 LACS HAS BEEN VOLUNTARILY SURRENDERED BY THE A SSESSEE. ACCORDINGLY HE MADE ADDITION OF RS. 16.60 LACS AND INTEREST THEREON RS. 3,52,800/-. 6. BEING AGGRIEVED BY THE ORDER OF AO, THIS ADDITIO N WAS CHALLENGED BEFORE LD. CIT (A), ALWAR WHO HAD PARTLY CONFIRMED THE ORDER B Y OBSERVING THAT TRANSACTION RELATING TO CASH RECEIPT AND PAYMENT RECORDED IN THE SAID DI ARY RELATE TO MONEY TAKEN FROM OTHER PARTIES AND GIVEN ON INTEREST TO OTHER PARTIES. SIN CE THE APPELLANT COULD NOT EXPLAIN THE SOURCE OF THESE RECEIPTS, THE PEAK AMOUNT HAS BEEN TAXED IN THE HANDS OF THE APPELLANT. FOR INTEREST ADDITION OF RS. 3,52,000/-, HE HAS ALL OWED THE SET OFF AGAINST THE PURCHASES MADE. THEREFORE, ADDITION ON ACCOUNT OF INTEREST HA S BEEN DELETED BY THE LD. CIT (A). 7. NOW FOR THE YEARS THE ASSESSEE IS IN APPEAL. 7.1. FOR AY. 1999-2000, THE LD. A/R OF THE ASSESSEE SUBMITTED THAT THE ITAT VIDE ORDER IN ITA NO. 664 & 609/JP/2007 FOR AY 1998-99 A ND 1999-2000 AS PER PARA 9 PAGE 4 OF THE ORDER HAD OBSERVED AS UNDER :- 9. FOR A.Y. 1998-99 THE ADDITION ON ACCOUNT OF PE AK CREDIT HAS BEEN MADE AT RS. 52,30,000/- AND FOR A.Y. 1999-2000 THE ADDITION HAS BEEN MADE OF RS. 16,60,000/- + INTEREST. THE C ONTENTION OF THE ASSESSEE SEEMS TO BE CONSIDERABLE THAT IF THE AMOUN T OF LOAN IS TREATED BELONGING TO THE ASSESSEE THEN THE SAME AMO UNT WILL BE AVAILABLE WITH THE ASSESSEE FOR NEXT YEAR ALSO. THI S ASPECT HAS ALSO NOT BEEN EXAMINED BY THE AO. THEREFORE, WE SET ASID E THE ISSUE TO THE FILE OF A.O TO EXAMINE THIS ASPECT ALSO. SAME F INDING IS ALSO 12 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL GIVEN IN RESPECT OF INTEREST CHARGED FOR A.Y. 1999- 2000. WE ORDER ACCORDINGLY. HE FURTHER SUBMITTED THAT NO BORROWING WAS SUBSTANT IATED FROM THE RECORD. THERE WAS NO INTEREST PAYMENT, THEREFORE, THE ADDITION DESERV ES TO BE DELETED. 7.2. WE HAVE HEARD RIVAL CONTENTIONS AND PERUSED TH E MATERIAL AVAILABLE ON RECORD. THE AO, AS PER STATEMENT OF SHRI ASHOK KUMA R GUPTA, HAS ASSESSED THE UNEXPLAINED CASH PEAK AT RS. 19.60 LACS FOR A.Y. 19 99-2000 AND RS. 4.50 LACS FOR A.Y. 1998-99. THE ASSESSEE ALWAYS HAS TAKEN THE STAND BE FORE THE LOWER AUTHORITIES IN ALL THE REPEATED PROCEEDINGS THAT THESE ARE THE DEBIT B ALANCES. THE ASSESSEE HAD SUFFICIENT CASH BALANCES IN THE CASH BOOK OF THE FI RM AND HAD EXPLAINED THE SOURCES OF CASH GIVEN BY THE ASSESSEE. THE CASH WAS AVAILABLE IN THE BOOKS WHEREAS IN DIARY THERE WAS A DEBIT BALANCE. IF BOTH ARE TO BE SEEN T OGETHER, THE SOURCE OF DEBIT BALANCE HAD BEEN EXPLAINED BY THE ASSESSEE BEFORE THE LOWER AUTHORITIES. THE LD. CIT (A) HAD REJECTED THE ASSESSEES CLAIM ON THE GROUND THAT TH IS ARGUMENT WAS RAISED BY THE ASSESSEE FOR THE FIRST TIME. THE COORDINATE BENCH O F ITAT HAD SET ASIDE THE ORDERS OF LOWER AUTHORITIES TO CALCULATE THE CORRECT PEAK. T HE LD. CIT (A) WAS ALSO WRONG IN HOLDING THAT ASSESSEE HAS TAKEN THIS STAND FOR THE FIRST TIME, BUT ASSESSEE TOOK THIS STAND BEFORE THE AO HIMSELF ON 28.12.2011. THE COR RESPONDING ENTRIES FROM THAT DIARY WERE ALSO REFLECTED IN THE BOOKS OF ACCOUNT OF THE APPELLANT FIRM AND IN THE BOOKS OF ACCOUNT OF M/S. RAM GOPAL RAJIV KUMAR AS PER ORDER OF LD. CIT (A) DATED 28.03.2007. EVEN THE NEW STAND TAKEN BY THE ASSESSEE IS ALSO RE QUIRED TO BE ADDRESSED BY THE LD. CIT (A) BY CONSIDERING THE VARIOUS DECISIONS OF THE APEX COURT. THE LD. A/R RELIED UPON 13 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL THE JUDGMENT IN CASE OF CIT VS. JUTE CORPORATION, 1 87 ITR 688 (SC), NATIONAL THERMAL POWER CO. LTD. VS. CIT, 229 ITR 383 (SC). IN CASE CIT VS. BREACH CANDY SWIMMING BATH TRUST, 27 ITR 279 (BOM.), HONBLE BOMBAY HIGH COURT HELD THAT BEFORE THE TRIBUNAL ANY ISSUE RAISED BY THE ASSESSEE FOR THE F IRST TIME, THE TRIBUNAL WAS RIGHT TO ADJUDICATE THE SAME. THE TRIBUNAL IS DUTY BOUND TO GIVE THE SUFFICIENT OPPORTUNITY ON NEW ISSUE RAISED BY THE ASSESSEE. SIMILAR VIEW HAS ALSO BEEN EXPRESSED BY THE HONBLE MADRAS HIGH COURT IN CASE OF CIT VS. INDIAN EXPRESS (MADURAI) PVT. LTD. (1983) 140 ITR 705. THE OPERATIVE PORTION IS REPRODUCED AS UNDER :- 11. WE WOULD, HOWEVER, TAKE UP FOR DISCUSSION T HOSE THREE CASES IN THE REVERSE ORDER. IN NELLIAPPANS CASE (SUPRA), THE AS SESSEE WAS PLYING MOTOR BUSES AND LORRIES. HE WAS ASSESSED TO INCOME-TAX ON ESTIMATES OF INCOME, AND ALSO IN ITEMISED ADDITIONS OF UNEXPLAINED CASH CREDITS. THE ASSESSEE APPEALED AGAINST THE ASSESSMENT MADE IN THIS MANNER . WHILE CONDUCTING THE APPEALS BOTH BEFORE THE AAC AND THE TRIBUNAL, THE A SSESSEE FOUND FAULT WITH THE ASSESSMENT ON THE LIMITED GROUND THAT THE ESTIM ATE WAS EXCESSIVE. THE TRIBUNAL REJECTED THE ASSESSEES CONTENTION. ON A REFERENCE THE HIGH COURT OBSERVED THAT THE MATTER REQUIRED RECONSIDERATION B Y THE TRIBUNAL, AND DISPOSED OF THE CASE ACCORDINGLY. AT THE TIME OF RE CONSIDERATION, IT WAS FOR THE FIRST TIME PUT FORWARD BEFORE THE TRIBUNAL ON T HE ASSESSEES BEHALF THAT THE ITO COULD NOT MAKE AN ESTIMATE OF INCOME AND AL SO ADD FURTHER AMOUNTS TOWARDS UNEXPLAINED CASH CREDITS. THE ASSESSEE FURT HER CONTENDED THAT THE ADDITION OF CREDITS WAS REDUNDANT, IN THE CIRCUMSTA NCES, AND MUST BE DELETED. THE TRIBUNAL ACCEPTED THIS NEW PLEA OF THE ASSESSEE, AND ALLOWED THE APPEAL IN PART DIRECTING THE DELETION OF THE CA SH CREDITS FROM THE ASSESSEES TAXABLE INCOME. THE COMMISSIONER THEREUP ON DEMANDED A REFERENCE FROM THE TRIBUNAL, RAISING THE QUESTION W HETHER THE TRIBUNAL WAS RIGHT IN LAW IN MAKING OUT A NEW CASE FOR THE ASSES SEE AND INTERFERING WITH THE ASSESSMENT. THE TRIBUNAL REJECTED THE REFERENCE APPLICATION. THE DEPARTMENT MOVED THE HIGH COURT FOR A DIRECTION TO THE TRIBUNAL, ASKING IT TO STATE A CASE AND REFER THE QUESTION OF LAW FOR DECI SION. THIS APPLICATION WAS DISMISSED BY THE HIGH COURT. ON APPEAL BY SPECIAL L EAVE, THE SUPREME COURT OBSERVED AS UNDER : 14 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL IN HEARING AN APPEAL THE TRIBUNAL MAY GIVE LEAVE TO THE ASSESSEE TO URGE GROUNDS NOT SET FORTH IN THE MEMORANDUM OF APPEAL, AND IN DECIDING THE APPEAL THE TRIBUNAL IS NOT RESTRICTED TO THE GROUNDS SET FORTH IN THE MEMORANDUM OF APPEAL OR TAKEN BY LEAVE OF THE TRIBUNAL. THE TRIBUNAL WAS, THEREFORE, COMPETENT TO ALLOW THE ASSESSEE TO RAISE THE CONTENTION RELATING TO THE CA SH CREDITS WHICH WAS NOT MADE THE SUBJECT MATTER OF A GROUND IN THE MEMORANDUM OF APPEAL. IT CANNOT BE SAID THAT IN ACCEPTING THE CONTENTION OF THE ASSESSEES THAT THE CASH CREDITS REPRESENTED INCOME FROM THE BUSINESS WITHHELD FROM THE BOOKS, THE TRIBUNAL MADE OUT A NEW CASE INCONSISTENT WITH THE ASSESSEES OWN PLEA. IN ANY EVENT, THE TRIBUNAL IS NOT PRECLUDED FROM ADJUSTING THE TAX LI ABILITY OF THE ASSESSEE IN THE LIGHT OF ITS FINDING MERELY BECAUSE THE FINDINGS ARE INCONSISTENT WITH THE CASE PLEADED BY THE ASSESSEE. 12. IN MAHALAKSHMI TEXTILE MILLS CASE (SUPRA), DECI DED BY THE SUPREME COURT, THE COURSE OF APPELLATE PROCEEDINGS WAS DIFF ERENT. THE ASSESSEE IN THAT CASE WAS A TEXTILE MILL ENGAGED IN THE MANUFAC TURE OF COTTON YARN. IN ITS SPINNING PLANT, THE ASSESSEE INTRODUCED WHAT WA S CALLED THE CASABLANCA CONVERSION SYSTEM. THE INTRODUCTION OF THIS SYSTEM INVOLVED THE REPLACEMENT OF CERTAIN EXISTING PARTS IN THE SP INNING MACHINERY WITH A NEW DEVICE. THE ASSESSEE CLAIMED THAT DEVELOPMENT R EBATE SHOULD BE ALLOWED ON THIS AMOUNT OF RS.93,215/- ON THE SCORE THAT THE PARTS OF MACHINERY CALLED THE CASABLANCA CONVERSION SYSTEM WHICH REPLACED THE EXISTING SPINNING PLANT MUST THEMSELVES BE REGARDED AS NEW PLANT OR MACHINERY INSTALLED FOR THE FIRST TIME. THE CLAIM F OR DEVELOPMENT REBATE WAS FOUNDED ON THIS VIEW OF THE CASABLANCA SYSTEM. BUT THE CLAIM FOR DEVELOPMENT REBATE WAS REJECTED BY THE ITO. ON APPE AL FILED BY THE ASSESSEE, THE CLAIM FOR DEVELOPMENT REBATE WAS REJE CTED BY THE AAC AS UNSUSTAINABLE. ON FURTHER APPEAL BEFORE THE TRIBUNA L, THE ASSESSEE GAVE UP ITS ORIGINAL GROUND OF CLAIM AND RAISED FRESH CL AIM. THIS NEW PLEA WAS QUITE INCONSISTENT WITH ITS CLAIM FOR ALLOWANCE OF DEVELOPMENT REBATE, AS A PERCENTAGE ON THE COST OF THE CASABLANCA SYSTEM. TH E ASSESSEE CONTENDED THAT THE AMOUNT SPENT FOR THE INTRODUCTIO N OF THE CASABLANCA CONVERSION SYSTEM MUST BE ALLOWED IN THE WHOLE SUM AS A REVENUE ITEM OF EXPENDITURE UNDER THE HEAD CURRENT REPAIRS. THE T RIBUNAL ENTERTAINED THIS NEW PLEA. AND ON BEING SATISFIED ABOUT THE MER ITS OF THIS PLEA, THE TRIBUNAL DIRECTED THE DELETION OF THE ENTIRE AMOUNT OF RS.93,215/- AS AN ADMISSIBLE DEDUCTION OF THE REVENUE EXPENDITURE. TH E DEPARTMENT CHALLENGED THE PROPRIETY OF THE TRIBUNAL ENTERTAINI NG THIS NEW PLEA. THE DEPARTMENT BROUGHT A REFERENCE BEFORE THE HIGH COUR T, ON THIS QUESTION, AS A JURISDICTIONAL ISSUE. BUT THE HIGH COURT UPHEL D THE JURISDICTION OF THE TRIBUNAL TO PERMIT THE ASSESSEE TO RAISE A NEW CONT ENTION, WHICH HAD NOT BEEN RAISED BY THE ASSESSEE BEFORE THE DEPARTMENTAL AUTHORITIES. THE 15 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL COMMISSIONER THEREUPON TOOK THE MATTER ON SPECIAL L EAVE BEFORE THE SUPREME COURT. IT WAS URGED FOR THE DEPARTMENT THAT THE TRIBUNAL HAD NO JURISDICTION TO ALLOW A PLEA FROM THE ASSESSEE WHIC H WAS INCONSISTENT WITH THE PLEA RAISED BEFORE THE DEPARTMENTAL AUTHORITIES . THIS CONTENTION, HOWEVER, WAS NEGATIVE BY THE SUPREME COURT. THE COU RT OBSERVED THUS: UNDER SUB-SECTION (4) OF SECTION 33 OF THE INDIAN INCOME-TAX ACT, 1922, THE APPELLATE TRIBUNAL IS COMPETENT TO PASS S UCH ORDERS ON THE APPEAL AS IT THINKS FIT. THERE IS NOTHING IN THE INCOME-TAX ACT WHICH RESTRICTS THE TRIBUNAL TO THE DETERMINATION O F QUESTIONS RAISED BEFORE THE DEPARTMENTAL AUTHORITIES. ALL QUESTIONS WHETHER OF LAW OR OF FACT WHICH RELATE TO THE ASSESSMENT OF THE ASSES SEE MAY BE RAISED BEFORE THE TRIBUNAL. IF FOR REASONS RECORDED BY THE DEPARTMENTAL AUTHORITIES IN REJECTING A CONTENTION RAISED BY THE ASSESSEE, GRANT OF RELIEF TO HIM ON ANOTHER GROUND IS JUSTIFIED, IT WOULD BE OPEN TO THE DEPARTMENTAL AUTHORITIES AND T HE TRIBUNAL, AND INDEED THEY WOULD BE UNDER A DUTY, TO GRANT THA T RELIEF. THE RIGHT OF THE ASSESSEE TO THE RELIEF IS NOT RESTRICT ED TO THE PLEA RAISED BY HIM. 13. THESE TWO DECISIONS OF THE SUPREME COURT WHICH WE HAVE CONSIDERED AT SOME LENGTH, WERE DISPOSED TO VIEW TH E TRIBUNALS JURISDICTION FAIRLY WIDELY. THE SUPREME COURTS VIE W CLEARLY WAS THAT, WHILE EXERCISING ITS APPELLATE JURISDICTION, THE TRIBUNAL IS NOT CONFINED TO THE GROUNDS WHICH ARE SET FORTH IN THE APPEAL MEMORANDU M OR TAKEN BY LEAVE OF THE TRIBUNAL. IN NELLIAPPANS CASE (SUPRA), THE ASSESSEES NEW CONTENTION WAS THAT THE ASSESSMENT OF UNEXPLAINED C ASH CREDITS HAD BECOME REDUNDANT, WHEN THE ASSESSING OFFICER HAD AL READY DECIDED TO ESTIMATE THE YEARS INCOME. THIS PLEA WAS PUT FORWA RD VERY LATE, ONLY AFTER THE CASE CAME BACK TO IT FROM THE HIGH COURT. IN MA HALAKSHMI TEXTILE MILLS, CASE (SUPRA), THE PLEA OF THE ASSESSEE FOR THE FIRS T TIME IN THE APPEAL BEFORE THE TRIBUNAL WAS FOR DEDUCTION OF THE ENTIRE AMOUNT SPENT ON THE CASABLANCA CONVERSION SYSTEM AS AN ITEM OF THE REVE NUE EXPENDITURE, JUST LIKE CURRENT REPAIRS, IN CONTRAST WITH THE ASS ESSEES ORIGINAL CLAIM FOR THE ALLOWANCE OF A PERCENTAGE ON THAT AMOUNT AS DEV ELOPMENT REBATE. IN BOTH CASES, THE SUPREME COURT HELD THAT SUCH A PLEA , ALTHOUGH NEW, WAS WITHIN THE APPELLATE JURISDICTION OF THE TRIBUNAL. INDEED, IN MAHALAKSHMI TEXTILE MILLS CASE (SUPRA), THE SUPREME COURT DESC RIBED THE TRIBUNALS APPELLATE JURISDICTION IN THE WIDEST TERMS POSSIBLE WHEN THEY SAID THAT ALL QUESTIONS, WHETHER OF LAW OR OF FACT, WHICH RELATE TO THE ASSESSMENT OF THE ASSESSEE MAY BE RAISED BEFORE THE TRIBUNAL AND THER E IS NOTHING IN THE INCOME-TAX ACT, WHICH RESTRICTS THE TRIBUNAL TO THE DETERMINATION OF THE QUESTIONS RAISED BEFORE THE DEPARTMENTAL AUTHORITIE S. ON THE BASIS OF THE PRINCIPLES LAID DOWN BY THE SUPREME COURT, IT MUST BE HELD IN THIS CASE 16 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL THAT THE ASSESSEE WAS NOT PRECLUDED FROM RAISING A NEW CONTENTION, AND THE TRIBUNAL WAS NOT PRECLUDED FROM EXAMINING AND D ETERMINING THAT CONTENTION, MERELY ON THE SCORE THAT IT HAD NOT BEE N PUT FORWARD AT THE EARLIER STAGES OF THE PROCEEDINGS IN ASSESSMENT AND IN THE FIRST APPEAL. THE PEAK CREDIT SUBMITTED BY THE ASSESSEE BEFORE TH E AO HAD NOT BEEN CONTROVERTED BY THE LOWER AUTHORITIES AS SUCH THERE WAS DEBIT BALAN CE WHICH MEANS THE ASSESSEE FIRM HAD ADVANCED THE MONEY FROM THE REGULAR BOOKS OF AC COUNT. THEREFORE, WE DELETE THE ADDITION CONFIRMED BY THE LD. CIT (A) AS FUND ADVAN CES FROM THE REGULAR CASH BOOK BUT THE TRANSACTIONS OF LOAN WERE RECORDED IN DIARY ON WHICH ASSESSEE EARNED THE INTEREST & HAD NOT BEEN SHOWN IN REGULAR BOOKS OF ACCOUNT. THU S WE CONFIRMED THE ADDITION ON ACCOUNT OF INTEREST AT RS. 20,000/-. FOR A.Y. 1999 -2000, THE LD. AO HAD NOT GIVEN CREDIT OF INVESTMENT IN PURCHASE OF RS. 20,90,604/- AGAINS T UNEXPLAINED PEAK CASH CREDIT OF RS 19,60,000/- WHICH IS TANTAMOUNT TO DOUBLE ADDITION. THEREFORE, ADDITION MADE ON ACCOUNT OF UNEXPLAINED CASH PEAK CREDIT OF RS. 19,6 0,000/- IS ALSO DELETED IN A.Y. 1999- 2000. 8. IN THE RESULT, APPEALS ARE PARTLY ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 18/02/20 16. SD/- SD/- YFYR DQEKJ VH-VKJ-EHUK (LALIET KUMAR) (T.R. MEENA) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 18 /02/2016 DAS/ 17 ITA NO. 262(2)/JP/2014 BADRI PRASAD RAM GOAL DAL MILL VKNS'K DH IZFRFYFI VXZSFKR @ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ @ THE APPELLANT- M/S.BADRI PRASD RAM GOPAL DALL MILL, ALWAR. 2. IZR;FKHZ @ THE RESPONDENT-THE ITO WARD 2(2), ALWAR. 3. VK;DJ VK;QDR @ CIT 4. VK;DJ VK;QDRVIHY @ THE CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ @ DR, ITAT, JAIPUR 6. XKMZ QKBZY @ GUARD FILE (ITA NO.262/JP/14 & 492/JP/13) VKNS'KKUQLKJ @ BY ORDER, LGK;D IATHDKJ @ ASST. REGISTRAR