M/s Rainbow International Pvt. Ltd., New Delhi V. ITO, New Delhi

ITA 3107/DEL/2013

• Counselvise Citation: [2016] 132 COUNSELVISE.COM (IT) 7973 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 11 month(s) 23 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 10-05-2016
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: F
• Next Hearing Date: 18-04-2016
• Assessment Year: 2005-2006
• Appeal Filed On: 17-05-2013
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: R S NEGI
• Keywords: Reopening of assessment; Unexplained cash credit; Income from undisclosed sources; Search and seizure; Principle of natural justice; Accommodation entries; Competent authority; Reassessment proceedings
• Section: 143(3); 142(1); 147; 148; 139

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH F, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI PRASHANT MAHARISHI, ACCOUNTANT MEMBER I.T.A. NO. 3107 /DEL/201 3 A.Y. 20 0 5 - 06 M/S RAINBOW INTERNATIONAL PVT. LTD. 7, SOUTH PATEL NAGAR, NEW DELHI 110 008 (PAN: AAACR4391L) VS. ITO, WARD 15(2), NEW DELHI (APPELLANT) (APPELLANT) (APPELLANT) (APPELLANT) (RESPONDENT) (RESPONDENT) (RESPONDENT) (RESPONDENT) ASSESSEE BY : SH. SALIL AGGARWAL, ADV. & SH. SHAILESH GUPTA, CA DEPARTMENT BY : SH. R.S. NEGI, SR. DR DATE OF HEARING : DATE OF HEARING : DATE OF HEARING : DATE OF HEARING : 18 1818 18- -- -0 00 04 44 4- -- -201 201 201 2016 66 6 DATE OF ORDER : DATE OF ORDER : DATE OF ORDER : DATE OF ORDER : 10 1010 10- -- -0 00 05 55 5- -- -201 201 201 2016 66 6 ORDER ORDER ORDER ORDER PER H.S. SIDHU : JM PER H.S. SIDHU : JM PER H.S. SIDHU : JM PER H.S. SIDHU : JM THIS APPEAL BY THE ASSESSEE IS DIRECTED AGAINST TH E ORDER OF THE LD. COMMISSIONER OF INCOME TAX (APPEALS)-XVIII, NEW DELHI DATED 01.3.2013 PERTAINING TO ASSESSMENT YEAR 2005-06 ON THE FOLLOWING GROUNDS:- 1. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS GROSSLY ERRED BOTH IN LAW AND ON FACTS IN SUSTAINING AN ASSESSMENT UNDER SECTION 143(3)/147 OF ITA NO.3107/DEL/2013 2 THE ACT AT AN INCOME OF RS.15,00, 000/- AS AGAINST RETURNED INCOME OF NIL/-. 2. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED BOTH IN LAW AND ON FACTS IN SUS TAINING THE INITIATION OF PROCEEDINGS UNDER SECTION 147 OF THE ACT AND, FURTHER COMPLETION OF ASSESSMENT UNDER SECTION 143(3)/147 OF THE ACT WITHOUT SATISFYING THE STATUTORY PRE-CONDITIONS FOR INITIATION OF THE PROCEEDINGS AN D, COMPLETION OF ASSESSMENT UNDER THE ACT. 3. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS IN SUSTAINING THE INITIATION OF PROCEEDINGS U/S 147 OF THE ACT ON THE BASIS OF INFORMATION RECEIVED FROM DIT (INVESTIGATION) MECHANICALLY AND WITHOUT INDEPENDENT APPLICATION OF MIND. 3.1 THAT FURTHER, THE REASONS RECORDED WERE MERE REASONS TO SUSPECT AND WERE JUST TO MAKE FISHING AND ROVING ENQUIRIES, AS NO INDEPENDENT ENQUIRY WAS CONDUCTED BY THE ASSESSING OFFICER BEFORE ISSUING SU CH NOTICE UNDER SECTION 148 AND AS SUCH THE PROCEEDING INITIATED UNDER SECTION 148 WAS A MERE PRETENCE. ITA NO.3107/DEL/2013 3 4 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED BOTH IN LAW AND ON FACTS IN MAKING AN ADDITION OF RS.15,00,000/- AS ALLEGED ACCOMMODATION ENTRY RECEIVED FROM SH. S.K. GUPTA, AN D HELD TO BE UNEXPLAINED CASH CREDIT ULS 68 OF THE ACT. 4.1 THAT IN DOING SO, THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS COMPLETELY IGNORED AND OVERLOOKED ALL THE NECESSARY DOCUMENTS WHICH WERE FIL ED BEFORE BOTH AO AND CIT (A), EXPLAINING THE FACT THAT T HE APPELLANT COMPANY HAS SOLD ITS SHAREHOLDING IN MIS CAPITAL TOWN PLANNERS LTD. TO M/S PASSION CHIT COMPAN Y PVT. LTD., WHICH WAS DULY REFLECTED IN THE APPELLANT COMPANY'S BANK ACCOUNT. 4.2 THAT FURTHER THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) IGNORED THE BASIC FACT THAT NO AMOUNT WAS EVER RECEIVED FROM SH. S.K. GUPTA (THE ALLEGED ACCOMMODATION ENTRY OPERATOR), RATHER RS. 15,00,000/- WAS RECEIVED FROM MIS PASSION CHITS COMPANY PVT. LTD. AND THAT TOO AGAINST SALE OF SHAREHOLDING IN MIS CAPIT AL TOWN PLANNERS LTD. AND ALL NECESSARY DETAILS REGARDI NG THE SAID TRANSACTIONS WERE FILED BEFORE LEARNED ITO, WHICH ITA NO.3107/DEL/2013 4 WERE TOTALLY IGNORED BY THE LEARNED ITO WITHOUT CONDUCTING ANY FURTHER ENQUIRY, THUS, ADDITION SO MADE BY LEARNED ITO AND SUSTAINED BY CIT (A) WAS CLEARLY BASED ON SUSPICIONS AND SURMISES AND IS LIABLE TO B E DELETED AS SUCH. 5. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED IN LAW AND ON FACTS BY IGNORING THE FACT THAT THERE COULD BE NO DOUBLE TAXATION OF THE SAME SUM ONCE AS SALE CONSIDERATION ON SALE O F SHARES OF M/S CAPITAL TOWN PLANNERS LTD. TO MIS PASS ION CHITS COMPANY PRIVATE LTD. AND AGAIN AS UNDISCLOSED INCOME RECEIVED FROM MIS PASSION CHITS COMPANY PRIVA TE LTD. THIS ADDITION IS IN DISREGARD OF THE JUDGMENT OF APEX COURT IN THE CASE OF LAXMIPAT SINGHANIA VS CIT REPORT ED IN 72 ITR 291 AND THEREFORE, UNSUSTAINABLE. 6. THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS IGNORED THE BASIC FACT THAT THE LEARNED I TO SOLELY BASED HIS ORDER ON STATEMENT MADE BY SH. D.N. TANEJA ON 07.01.2009 WHEREIN HE SURRENDERED RS. 6.2 3 CRORES, WHEREIN HE SPECIFICALLY SURRENDERED RS. 15,00,000/- ON BEHALF OF APPELLANT COMPANY, IGNORIN G ITA NO.3107/DEL/2013 5 AND OVERLOOKING THE BASIC FACT THAT SH. D.N. TANEJA WAS NEVER A DIRECTOR IN THE APPELLANT COMPANY AND NOR HE HAD ANY SHAREHOLDING IN THE APPELLANT COMPANY, AND THUS, T HE SURRENDER MADE BY HIM ON BEHALF OF APPELLANT COMPAN Y CANNOT BE RELIED UPON, AS HE IS NOT AWARE OF THE FACTS OF THE APPELLANT COMPANY. 7 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER RELIED ON A GENERAL STATEMENT OF SH. S.K. GUPTA DATED 05.01.2009, WHEREIN NO WHERE HE MENTIONED THAT HE HAS GIVEN ACCOMMODATION ENTRIES TO APPELLANT COMPANY AND NO WHERE HE HAD MENTIONED THAT HE HAS RECEIVED CASH IN LIEU OF CHEQUES ISSUED BY M /S PASSION CHITS COMPANY PVT. LTD. TO APPELLANT COMPANY. HIS STATEMENT IS GENERAL IN NATURE AND CANNOT BE REL IED UPON AND ADDITION MADE ON HIS STATEMENT IS TOTALLY BASED ON IRRELEVANT CONSIDERATIONS, CONJECTURES AND SURMIS ES AND AS SUCH IS LIABLE TO BE DELETED AS SUCH. 8 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN LAW AND ON FACTS IN MAKING ADDITIONS IN THE HANDS OF ASSESSEE COMPANY, WITHOUT GIVING ANY FAIR AND PROPER OPPORTUNITY OF BEING HEAR D TO ITA NO.3107/DEL/2013 6 THE APPELLANT COMPANY. THEREBY, VIOLATING THE PRINCIPLE S OF NATURAL JUSTICE. 9 THAT THE LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS FURTHER ERRED BY SUSTAINING OF LEVY OF INTEREST ULS 2348 OF THE ACT, WHICH IS NOT LEVIABLE ON THE FACTS OF THE APPELLANT COMPANY. 2. THE BRIEF FACTS OF THE CASE ARE THAT ORIGINAL RE TURN OF INCOME WAS FILED ON 21.11.2015 DECLARING LOSS OF RS. 14,66 0/-. NOTICE U/S. 148 OF I.T. ACT DATED 28.3.2011 WAS ISSUED AND SERVE D ON THE ASSESSEE, AFTER DULY RECORDING REASONS FOR REOPENING THE ASSESSMENT AND APPROVAL OF THE COMPETENT AUTHORITY. LD. AUTHORIS ED REPRESENTATIVE ATTENDED THE ASSESSMENT PROCEEDINGS AND FILED THE REPLY DATED 27.4.2011 STATING THEREIN THAT THE RETURN FILED U/S. 139 OF THE I.T. ACT, MAY BE TREATED AS FILED IN RESPONSE TO NOTICE U/S. 148 OF I.T. ACT. NOTICES U/S. 142(1) OF THE I.T. AC T DATED 20.7.2011, 14.9.2011 AND U/S. 143(2) DATED 14.9.2011 WAS ISSUED . THE ASSESSEE VIDE LETTER DATED 8.11.2011 FILED OBJECTIO N AGAINST THE ISSUE OF NOTICE U/S. 148 OF I.T. ACT. FURTHER THE ASSE SSEE SOUGHT THE MATERIAL RELIED ON FOR REOPENING THE ASSESSMENT. THE OBJECTION FILED BY THE ASSESSSEE WAS DISPOSED OFF VIDE ORDER DATED 1 1.11.2011. THE ASSESSEE HAD DURING THE YEAR UNDER CONSIDERATION RECEIVED A ITA NO.3107/DEL/2013 7 SUM OF RS. 15 LAKHS FROM M/S PASSION CHITS PVT. LTD. SEARCH AND SEIZURE OPERATION WERE CARRIED OUT IN M/S TANEJA PURI GROUP OF CASES, WHEREIN IT WAS ESTABLISHED THAT THE ASSESSEE COM PANY BELONGING TO TANEJA GROUP OF CASES HAD RECEIVED ACCO MMODATION ENTRY FROM SH. SK GUPTA AND HIS CONCERNS. IN HIS STA TEMENT SH. DN TANEJA ADMITTED OF GIVING ACCOMMODATION ENTRY TO THE AS SESSEE COMPANY AMOUNTING TO RS. 15 LAC. THE AO THEREFORE, A SKED THE ASSESSEE TO :- I- PRODUCE THE DIRECTOR OF M/S PASSION CHIT CO. PVT. LTD. II- CONFIRM WHETHER THE ASSESSEE COMPANY WAS A GROUP COMPANY OF TANEJA GROUP OF COMPANIES. III- WHETHER THE DIRECTORS / SHAREHOLDERS WERE RELATED TO SH. DN TANEJA. IV- PROVIDED WITH THE STATEMENT OF SH. DN TANEJA. V- PROVIDE INDEPENDENT THIRD PARTY EVIDENCE AND FURNISH DOCUMENTARY EVIDENCE TO PROVE THE IDENTITY OR CREDITWORTHINESS AND GENUINENESS OF THE TRANSACTION. 2.1 THE AO TREATED THE AMOUNT OF RS. 15 LACS AS ASSES SEES INCOME FROM UNDISCLOSED SOURCES AND MADE ADDITION U/ S. 68 OF THE ACT AS THE ASSESSEE HAD FAILED TO DISCHARGE ITS ONUS THAT THE SHARE APPLICATION MONEY WAS GENUINE AND HAD FAILED TO ESTAB LISH THE ITA NO.3107/DEL/2013 8 IDENTITY AND CREDITWORTHINESS OF THE PERSONS MAKING TH E INVESTMENT AS WELL AS ITS CAPACITY TO MAKE THE INVESTMENT. THE D IRECTOR OF THE COMPANY WAS ALSO NOT PRODUCED BY THE ASSESSEE. THE AO COMPLETED THE ASSESSMENT AT RS. 15 LACS U/S. 147/143( 3) OF THE I.T. ACT, 1961 VIDE HIS ORDER DATED 30.12.2011. 3. AGGRIEVED WITH THE ACTION OF THE ASSESSING OFFICER, ASSESSEE FILED THE APPEAL BEFORE THE LD. CIT(A), WHO VIDE HIS IMPUGNED ORDER DATED 01.03.2013 DISMISSED THE APPEAL OF THE ASSESSE E BY UPHOLDING THE ASSESSMENT ORDER PASSED BY THE AO. 4. AGAINST THE LD. CIT(A)S ORDER DATED 1.3.2013, NOW THE ASSESSEE IS IN APPEAL BEFORE THE TRIBUNAL. 5. AT THE TIME OF HEARING, LD. COUNSEL OF THE ASSESSEE STATED THAT ASSESSEE FILED ITS RETURN OF INCOME FOR THE ASSESSMENT YEAR 2005-06 ON 21.11.2005 DECLARING A LOSS OF RS. 14,660/- AND NOTICE U/S. 148 WAS ISSUED ON 28.3.2011 ALONGWITH REASONS RECORDED. THE ASSESSEE VIDE LETTER DATED 27.4.2011 STATED THAT ORIGINAL RETURN OF INCOME FILED SHOULD BE TAKEN AS THE RETURN FILED IN RESPONS E TO THE NOTICE U/S. 148. THE ASSESSEE VIDE LETTER DATED 8.11.2011 F ILED ITS OBJECTIONS TO REOPENING OF ASSESSMENT WHICH WERE DULY DISCLOSED BY THE AO THROUGH ITS ORDER DATED 11.1.2011, REJECTING THE OBJECTIONS OF THE ASSESSEE COMPANY. HE STATED THAT THE ADDITION HAS BEEN ITA NO.3107/DEL/2013 9 MADE ON THE BASIS OF THE STATEMENTS RECORDED BY SH. DN T ANEJA ON 07.1.2009, WHO IS A THIRD PARTY. IN THIS REGARD, HE DRAW OUR ATTENTION TOWARDS THE HONBLE DELHI HIGH COURT DECISI ON IN THE CASE OF CIT VS. PRADEEP KUMAR GUPTA & ANR. REPORTED IN ( 2008) 303 ITR 95 (DELHI). HE FURTHER STATED THAT RIGHT OF CROSS EXAM INATION HAS NOT BEEN GIVEN TO THE ASSESSEE WHICH IS AGAINST THE PRIN CIPLE OF NATURAL JUSTICE. TO SUPPORT THIS CONTENTION, HE FURTHER DRAW OUR ATTENTION TOWARDS THE HONBLE SUPREME COURT OF INDIA DECISION I N THE CASE OF ANDAMAN TIMBER INDUSTRIES VS. COMMISSIONER OF CENTR AL EXCISE REPORTED IN (2015) 94 CCH 0187 (SC). IN VIEW OF THE ABOVE, HE REQUESTED THAT ADDITION MAY BE DELETED AND APPEAL OF THE ASSESSEE MAY BE ALLOWED. 6. ON THE CONTRARY, LD. DEPARTMENTAL REPRESENTATIVE HAS RELIED UPON THE ORDER OF THE AUTHORITIES BELOW AND STATED TH AT THE SAME MAY BE UPHELD AND THE APPEAL OF THE ASSESSEE MAY BE DISMISSED ACCORDINGLY. 7. WE HAVE HEARD BOTH THE PARTIES AND PERUSED THE RECO RDS, ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES, CASE LAWS CITED BY THE LD. COUNSEL OF THE ASSESSEE. WE FIND THAT I N THE PRESENT CASE AN ADDITION OF RS. 15 LACS WAS MADE BY THE AO ON THE BASIS OF STATEMENT RECORDED ON 7.1.2009 OF MR. DN TANEJA WHERE IN HE ITA NO.3107/DEL/2013 10 SURRENDERED THE SAID AMOUNT OF RS. 15 LACS ON COMPAN YS ACCOUNT TO BUY PEACE OF MIND, IN DOING SO, HE IGNORED THE BASIC FACT THAT SH. DN TANEJA HAD NO LOCUS STANDI WITH RESPECT TO THE ASSES SEE COMPANY, AS HE WAS NEVER A DIRECTOR NOR A SHARE HOL DER IN THE ASSESEE COMPANY AND THUS NO RELIANCE COULD HAVE BEEN PLACED ON SUCH GENERAL STATEMENT AND AS SUCH, THE REASONS RECORDE D BY THE AO WERE MERELY BASED ON SUSPICION, SURMISES AND CON JECTURES AND ARE HENCE NOT SUSTAINABLE IN THE EYES OF LAW. WE FIND CONSIDERABLE COGENCY IN THE LD. COUNSEL OF THE ASSESSEES SUBMISSI ONS THAT ADDITION CANNOT BE MADE ON THE BASIS OF THE STATEMENT RECORDED OF THIRD PARTY AND WITHOUT PROVIDING OPPORTUNITY OF CROS S EXAMINATION OF THE WITNESS TO THE ASSESSEE, IN VIEW OF THE HONB LE DELHI HIGH COURT DECISION IN THE CASE OF CIT VS. PRADEEP KUMAR G UPTA & ANR. REPORTED IN (2008) 303 ITR 95 (DELHI). WE FIND THAT THE HONBLE DELHI HIGH COURT IN THIS CASE HAS HELD AS UNDER:- THAT THE ASSESSMENT HAD NOT BEEN COMPLETED UNDER SECTION 143(3) OF THE ACT. THERE WERE BANKING TRANSACTIONS BETWEEN THE ASSESSES AND A. THE REASSESSMENT PROCEEDINGS HAD BEEN INITIATED AFTER SEVERAL YEARS OF THE ACCEPTANCE OF THE RETURN UNDER SECTION 143(1) OF THE ACT. THE ASSESSEES FAILURE TO BRING THE PERSON TILLING THE LAND ON THEIR BEHALF COULD NO T ITA NO.3107/DEL/2013 11 INEXORABLY LEAD TO THE CONCLUSION THAT NO AGRICULTURA L INCOME HAD BEEN GENERATED BY THE ASSESSES. SUCH AN INTERFERENCE COULD ONLY BE DRAWN FROM THE STATEMENT O F A TO THE EFFECT THAT THE TRANSACTIONS BETWEEN HIM AND THE ASSESSES WERE BOGUS. THEREFORE, IT WAS MANDATORY FOR THE REVENUE TO PRODUCE A FOR CROSS EXAMINATIO N BY THE ASSESSES ON THEIR SPECIFIC DEMAND. ONCE SECT ION 147 OR 148 WAS RESTORED THE TO, THE ASSESSING OFF ICER MUST FIRST DISCHARGE THE BURDEN OF SHOWING THAT INCOME HAD ESCAPED ASSESSMENT. IT WAS ONLY THEREAFTER THAT TH E ASSESSES HAD TO PROVIDE ALL THE ANSWERS. THE TRIBUNA L ARRIVED AT THE CORRECT CONCLUSION. 8. WE FURTHER FIND CONSIDERABLE FORCE IN THE LD. COUN SEL OF THE ASSESSEES SUBMISSIONS THAT IN VIEW OF THE HONBLE S UPREME COURT OF INDIA DECISION IN THE CASE OF ANDAMAN TIMBER INDUSTR IES VS. COMMISSIONER OF CENTRAL EXCISE REPORTED IN (2015) 9 4 CCH 0187 (SC) THE ASSESSEE IS ENTITLED FOR CROSS EXAMINE THE WITNESS. WE FIND THAT THE HONBLE APEX COURT CONCLUDED THAT NOW ALLOWIN G ASSESSEE TO CROSS-EXAMINE, AMOUNTING TO SERIOUS FLAW WHICH MAK E IMPUGNED ORDER NULLITY AND VIOLATION OF PRINCIPLES OF NATURAL JUSTICE. THE HONBLE SUPREME COURT OF INDIA VIDE PARA NO. 6 TO 8 HAS ADJUDICATED THE ISSUE AS UNDER:- ITA NO.3107/DEL/2013 12 6. ACCORDING TO US, NOT ALLOWING THE ASSESSEE TO CRO SS- EXAMINE THE WITNESSES BY THE ADJUDICATING AUTHORITY THOUGH THE STATEMENTS OF THOSE WITNESSES WERE MADE THE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY INASMUCH AS IT AMOUNTED TO VIOLATION OF PRINCIPLES OF NATURAL JUSTICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. IT IS TO BE BOR NE IN MIND THAT THE ORDER OF THE COMMISSIONER WAS BASED U PON THE STATEMENTS GIVEN BY THE' AFORESAID TWO WITNESSES. EVEN WHEN THE ASSESSEE DISPUTED THE CORRECTNESS OF THE STATEMENTS AND WANTED TO CROSS-EXARRME, THE ADJUDICATING AUTHORITY DID NOT GRANT THIS OPPORTUNITY T O THE ASSESSEE. IT WOULD BE PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER PASSED BY THE ADJUDICATING AUTHORITY HE HAS SPECIFICALLY MENTIONED THAT SUCH AN OPPORTUNITY W AS SOUGHT BY THE ASSESSEE. HOWEVER, NO SUCH OPPORTUNITY WAS GRANTED AND THE AFORESAID PLEA IS NOT EVEN DEALT WITH BY THE ADJUDICATING AUTHORITY. AS FAR AS THE TRIBUNAL IS CONCERNED, WE FIND THAT REJECTION OF THIS PLEA IS TOTALLY UNTENABLE. THE TRIBUNAL HAS SIMPLY STATED THAT CROSS- EXAMINATION OF THE SAID DEALERS COULD NOT HAVE BROUG HT OUT ANY MATERIAL WHICH WOULD NOT BE IN POSSESSION OF THE ITA NO.3107/DEL/2013 13 APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX- FACTORY PRICES REMAIN STATIC. IT WAS NOT FOR THE TRI BUNAL TO HAVE GUESS WORK AS TO FOR WHAT PURPOSES THE APPELLAN T WANTED TO CROSS-EXAMINE THOSE DEALERS AND WHAT EXTRACTION THE APPELLANT WANTED FROM THEM. 7. AS MENTIONED ABOVE, THE APPELLANT HAD CONTESTED THE TRUTHFULNESS OF THE STATEMENTS OF THESE TWO WITNESSES AND WANTED TO DISCREDIT THEIR TESTIMONY FOR WHICH PURPOSE IT WANTED TO AVAIL THE OPPORTUNITY OF CROSS- EXAMINATION. THAT APART, THE ADJUDICATING AUTHORITY SIMPLY RELIED UPON THE PRICE LIST AS MAINTAINED AT THE DEPOT TO DETERMINE THE PRICE FOR THE PURPOSE OF LEVY OF EXCISE DUTY. WHETHER THE GOODS WERE, IN FACT, SOLD TO THE SAID DEALERS/WITNESSES AT THE PRICE WHICH IS MENTIONED IN T HE PRICE LIST ITSELF COULD BE THE SUBJECT MATTER OF CROSS- EXAMINATION. THEREFORE, IT WAS NOT FOR THE ADJUDICATI NG AUTHORITY TO PRESUPPOSE AS TO WHAT COULD BE THE SUBJE CT MATTER OF THE CROSS-EXAMINATION AND MAKE THE REMARKS AS MENTIONED ABOVE. WE MAY ALSO POINT OUT THAT ON AN EARLIER OCCASION WHEN THE MATTER CAME BEFORE THIS COUR T ITA NO.3107/DEL/2013 14 IN CIVIL APPEAL NO. 2216 OF 2000, ORDER DATED 17.03 .2005 WAS PASSED REMITTING THE CASE BACK TO THE TRIBUNAL WITH THE DIRECTIONS TO DECIDE THE APPEAL ON MERITS GIVING ITS REASONS FOR ACCEPTING OR REJECTING THE SUBMISSIONS . 8. IN VIEW THE ABOVE, WE ARE OF THE OPINION THAT IF TH E TESTIMONY OF THESE TWO WITNESSES IS DISCREDITED, THERE WAS NO MATERIAL WITH THE DEPARTMENT ON THE BASIS OF WHICH IT COULD JUSTIFY ITS ACTION, AS THE STATEMENT OF T HE AFORESAID TWO WITNESSES WAS THE ONLY BASIS OF ISSUING THE SHOW CAUSE NOTICE. WE, THUS, SET ASIDE THE IMPUGNED ORDER AS PASSED BY THE TRIBUNAL AND ALLOW THIS APPEAL. NO COSTS. 9. IN THE BACKGROUND OF THE AFORESAID DISCUSSIONS A ND RESPECTFULLY FOLLOWING THE PRECEDENTS OF THE HONBLE SU PREME COURT AND HONBLE DELHI HIGH COURT, AS AFORESAID WE ARE OF THE CONSIDERED OPINION THAT THE ADDITION MADE ON THE BASIS OF THE STATEM ENT IN THE PRESENT CASE IS NOT SUSTAINABLE IN THE EYES OF LAW, BECAUSE THE RIGHT OF CROSS EXAMINATION TO THE ASSESSEE WAS NOT PROVIDED , HENCE, WE DELETE THE ADDITION OF RS. 15 LACS MADE BY THE AO AND CONFIRMED BY THE LD. CIT(A) AND ALLOW THE APPEAL OF THE ASSESSEE. ITA NO.3107/DEL/2013 15 10. IN THE RESULT, THE APPEAL FILED BY THE ASSESSEE STANDS ALLOWED. ORDER PRONOUNCED IN THE OPEN COURT ON 10/05/2016. SD/- SD/- [PRASHANT MAHARISHI] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 10/05/2016 SRBHATNAGAR COPY FORWARDED TO: - 1. APPELLANT - 2. RESPONDENT - 3. CIT 4. CIT (A) 5. DR, ITAT TRUE COPY BY ORDER, ASSISTANT REGISTRAR, ITAT, DELHI BENCHES