Smt. Shilpa Pasari, New Delhi V. ITO, New Delhi

ITA 3204/DEL/2009

• Counselvise Citation: [2011] 140 COUNSELVISE.COM (IT) 52850 (ITAT-DELHI)
• Duration Of Justice: 2 year(s) 3 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 14-10-2011
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 13-09-2011
• Assessment Year: 1998-1999
• Appeal Filed On: 14-07-2009
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: ANUSHA KHURANA
• Assessee Lawyers: T R TALWAR
• Keywords: Unexplained cash credit; Business expenditure
• Section: 37(1)

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G NEW DELHI BEFORE SHRI R.P. TOLANI AND SHRI K.G. BANSAL ITA NO. 3204/DEL/2009 ASSTT. YR: 1998-99 SMT. SHILPA PASARI VS. INCOME-TAX OFFICER, D-214, DEFENCE COLONY, WARD 12(9), NEW DELHI. NEW DELHI-110024. PAN/GIR NO. __________. ITA NO. 3208/DEL/2009 ASSTT. YR: 1998-99 INCOME-TAX OFFICER, VS. SMT. SHILPA PASARI WARD 12(9), NEW DELHI. D-214, DEFENCE COLONY, NEW DELHI-110024. (APPELLANT ) ( RESPONDENT ) ASSESSEE BY : SHRI T.R. TALWAR ADV. DEPARTMENT BY : SMT. ANUSHA KHURANA DR O R D E R PER R.P.TOLANI, J.M : THESE ARE CROSS APPEALS FILED BY THE ASSESSEE AND T HE REVENUE AGAINST THE ORDER OF CIT(A) DATED 4-5-2009 FOR A.Y. 1998-99 ON ACCOUNT OF THEIR RESPECTIVE GRIEVANCES. 2. GROUNDS RAISED IN ASSESSEES APPEAL ARE AS UNDER : 1. FOR THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE ASSESSING OFFICER WAS WHOLLY WRONG AND UNJ USTIFIED IN ADDING THE VALUE OF ALLEGED BENEFIT OF RS. 3,49,023 /- THE LD. CIT(A) WAS EQUALLY WRONG AND UNJUSTIFIED IN CONFIRM ING THE ACTION OF THE AO WITHOUT JUDICIOUSLY CONSIDERING AN D APPRECIATING THE FACTS OF THE CASE. ACTIONS OF THE AO AND LD. CIT(A) WERE UNREASONABLE, UNCALLED FOR AND BAD IN L AW. ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 2 2. FOR THAT IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE THE LD. CIT(A) WAS WHOLLY WRONG AND UNJUSTIFIE D IN TREATING A SUM OF RS. 83,320/- AS INCOME U/S 10(3) OF THE ACT, MADE IN ASSESSMENT BY THE AO. THE LD. CIT(A) WAS EQ UALLY WRONG AND UNJUSTIFIED IN CONFIRMING THE ACTION OF T HE AO WITHOUT JUDICIOUSLY CONSIDERING AND APPRECIATING TH E FACTS OF THE CASE. ACTIONS OF THE AO AND LD. CIT(A) WERE UNR EASONABLE, UNCALLED FOR AND BAD IN LAW. 3. FOR THAT YOUR PETITIONER CRAVES THE RIGHT TO PUT ADDITIONAL GROUNDS AND/OR TO ALTER/AMEND/MODIFY THE PRESENT GR OUNDS AT THE TIME OF HEARING. 3. GROUNDS RAISED IN REVENUES APPEAL ARE AS UNDER: 1. LD. COMMISSIONER OF INCOME TAX (APPEALS) ERRED, IN LAW AND ON THE FACTS AND CIRCUMSTANCES OF THE CASE, IN DELETING THE ADDITION OF RS. 20,86,980/- MADE BY THE AO ON ACCOU NT OF BOGUS CREDITORS. 2. THE APPELLANT CRAVES THE RIGHT TO MODIFY, ALTER, ADD OR FOREGO ANY GROUNDS OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THIS APPEAL. 4. BRIEF FACTS ARE THAT THE ASSESSEE IS A NON-EMPLO YEE DIRECTOR OF M/S SHREE KRISHNA CREDIT & SECURITIES PVT. LTD. (SKCSP L) AND NO SALARY OR DIRECTORS FEE WAS PAID TO THE ASSESSEE. THE ASSESS EES HUSBAND IS ALSO A DIRECTOR OF ANOTHER GROUP CONCERN M/S SHREE KRISHNA PAPER MILLS & INDUSTRIES LTD. (SKPMIL). IT IS THE CASE OF THE A SSESSEE THAT SHE AND HER HUSBAND BOTH WENT ON BUSINESS TOURS AS DIRECTORS OF RESPECTIVE COMPANIES. BOTH THE COMPANIES CLAIMED THE EXPENDITURE INCURRED ON THEIR TRIPS AS BUSINESS EXPENDITURE, WHICH HAS BEEN ALLOWED BY THE REVENUE IN BOTH THE CASES OF THE COMPANIES. AO WAS OF THE VIEW THAT ASS ESSEE IN CASE OF ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 3 SKCSPL HAD TAKEN PLEASURE TRIP AND THE EXPENSES WE RE INCURRED BY THE COMPANY AND PROPOSED TO ADD THEM AS PERQUISITE/ PRO FITS IN LIEU OF SALARY U/S 17(3) OF THE I.T. ACT. 4.1. IN ANOTHER BUSINESS TOUR OF THE PAPER MILL WHE RE HER HUSBAND IS I.E. SKPMIL, ASSESSEES HUSBAND WENT ON BUSINESS TOUR AN D THE ASSESSEE ACCOMPANIED HIM. AN EXPENDITURE OF RS. 88,320/- WAS INCURRED BY THE SAID SKPMIL. SINCE ASSESSEE HAD NO OFFICIAL STANDING IN THE SAID COMPANY I.E. SKPMIL, THIS AMOUNT WAS OFFERED FOR TAXATION BY THE SKPMIL BY ADDING IT BACK TO ITS INCOME. AO, HOWEVER, WAS OF THE VIEW TH AT THIS WAS A CASUAL AND NON-RECURRING RECEIPT OFFERED BY SKPMIL TO ASSESSEE . THIS ADDITION WAS ALSO MADE. 6. FACTS IN RESPECT OF CASH CREDITS ARE: (1) THE AO FOUND CASH CREDITS APPEARING IN THE BOOK S OF THE ASSESSEE AS UNDER: M/S UB FINANCE PVT. LTD. RS. 12,48,225/- M/S UB FINANCIAL SERVICES RS. 7,27,695/- SHRI U.R. BHANDARI RS. 1,11,000/- RS. 20,86,980/- AO OBSERVED THAT THESE PERSONS APPEARED AS CREDITOR S IN ASSESSEES BALANCE-SHEET. HE REQUIRED THE ASSESSEE TO EXPLAIN THE SAME, AS THE SUMMONS HAD COME BACK AND SHRI U.R. BHANDARI HAD D ENIED HAVING ADVANCED THE SUM. ASSESSEE CONTENDED THAT ALL THES E CASH CREDITS WERE RECEIVED IN EARLIER YEARS WHICH HAS BEEN ACCEP TED BY THE DEPARTMENT, THEREFORE, THESE CASH CREDITS CANNOT BE ADDED AS UNEXPLAINED CASH CREDITS DURING THIS ASSESSMENT YEA R. (2) BESIDES ASSESSEE CONTENDED THAT THERE WERE DISPUTES BETWEEN THESE PARTIES AND THEY REFUSED TO GIVE ANY CONFIRMATION. THESE CREDIT ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 4 ENTRIES REPRESENTED AMOUNT DUE ON PURCHASE OF SHARE S IN EARLIER YEAR BUT SOME PART PAYMENTS WERE ALSO MADE IN EARLI ER YEARS AND THESE WERE THE OUTSTANDING BALANCES BROUGHT FORWARD AS THE OPENING BALANCE IN THIS CASE. (3) SHRI U.R. BHANDARI IS THE SOLE PROPRIETOR OF UB FIN ANCIAL SERVICES AND DIRECTOR OF M/S UB FINANCE PVT. LTD., WITH WHOM THERE WERE DISPUTES. SOME TRANSACTIONS WERE THROUGH BROKER AND MR. U.R. BHANDARI INSISTED ON PAYING THE CASH TO REIMBURSE H IMSELF. SINCE THERE WAS A DISPUTE ABOUT THE PAYMENT, MR. U.R. BHA NDARI HAD TAKEN A HOSTILE STAND. (4) DURING THE CROSS-EXAMINATION OF SHRI U.R. BHANDARI , HE ADMITTED THAT HE SOLD SOME SHARES THROUGH SHRI V.K. GUPTA AN D DELIVERED THEM. HE ADMITTED THE SALE OF 25300 SHARES BY BILL NO. UBF/96-97- 005 DATED 9-7-96, WHICH HE CLAIMED NOT SOLD TO ASSE SSEE BUT TO SKCSPL. (5) THE ASSESSEE MADE THE PURCHASE IN HER NAME AND BILL S WERE ALSO ISSUED IN HER NAME, WHICH BEAR THE SIGNATURE OF SHR I U.R. BHANDARI AS AUTHORIZED SIGNATORY OF UB FINANCIAL SERVICES. (6) THESE SHARES WERE DULY SENT TO COMPANY FOR RECORDIN G THE TRANSFER IN THE NAME OF ASSESSEE SHOWING THE DATE OF TRANSFE R AS 3-9-1996 FOR 14700 SHARES. (7) THE ASSESSEE ISSUED CHEQUE ON 24-7-06 FROM HER PERS ONAL BANK A/C NO. 22164 WITH ORIENTAL BANK OF COMMERCE CHAWRI BAZ AR, DELHI. 6.1. IT WAS PLEADED THAT ASSESSEE HAD DISCHARGED IT S PRELIMINARY BURDEN IN RESPECT OF IDENTITY, GENUINENESS AND CREDITWORTHINE SS. DURING THE COURSE OF CROSS-EXAMINATION, ASSESSEES COUNSEL ASKED SHRI U. R. BHANDARI TO PROVIDE ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 5 SPECIMEN OF HIS SIGNATURE, WHO DECLINED TO DO SO. H OWEVER, THE ASSESSEE SENT HIS SIGNATURES MADE IN STATEMENT BEFORE THE AO TO H ANDWRITING EXPERT FOR COMPARISON WITH THE BILLS PERTAINING TO PURCHASE OF SHARES. THE HANDWRITING EXPERT GAVE REPORT CONFIRMING THAT THE SIGNATURE CL AIMED TO BE OF U.R. BHANDARI ON THE STATEMENT RECORDED BY AO AND ONE ON THE BILLS ISSUED TO ASSESSEE TALLIED WITH EACH OTHER. THIS REPORT WAS G IVEN TO AO WITH A REQUEST TO CONFRONT THE HANDWRITING EXPERT TO SHRI U.R. BHA NDARI, WHICH WAS NOT DONE. AO, HOWEVER, WAS NOT SATISFIED AND MADE THES E ADDITIONS AS UNEXPLAINED CASH CREDITS. AGGRIEVED, ASSESSEE PREFERRED FIRST APPEAL BEFORE T HE CIT(A). 6.2. THE CIT(A) CONFIRMED FIRST TWO ADDITIONS, BY H OLDING AS UNDER: U/S 17(3) : 4.2. UNDER THESE FACTS, IT IS TO BE CONSIDERED IF ANY AMOUNT IS TAXABLE IN THE CASE OF THE ASSESSEE IN THE CAPACITY OF THE DIRECTOR OF SKCSPL UNDER THE PROVISIONS OF SECTION 2(24) WHI CH DEFINE THE INCOME ON INCLUSIVE BASIS. SUB CLAUSE (IV) OF SECTION 2(24) COVERS A CASE WHERE THE ASSESSEE CONCERNED IS A DIR ECTOR IN A COMPANY FROM WHICH THE BENEFIT FLOWS TO THE SAID DI RECTOR. THE PROVISIONS HAVE BEEN ANALYZED BY MADRAS HIGH COURT IN THE CASE OF RAVI PRAKASH KHEMKA V/S CIT 295 ITR 33 (MAD ); THE HEAD NOTES OF WHICH ARE AS UNDER: PERSONAL EXPENSES ON CREDIT CARD OF DIRECTOR PAYMENT BY COMPANY LIC PREMIUM PAID BY COMPANY ASSESSABLE AS INCOME OF DIRECTOR INCOME-TAX ACT, 1061, S.2(24)(IV). UNDOUBTEDLY, BY UNDERTAKING VISIT WITH HER HUSBAND , THE APPELLANT AHS BEEN BENEFITED AND THE BENEFIT IS TO BE CONSIDERED APPROPRIATELY IN THE HANDS OF THE ASSESSEE. IT IS I MMATERIAL WHICH OF THE SECTIONS ARE APPLICABLE TO BRING SAID PAYMENT AS TAXABLE SUM BUT THE SUBSTANCE OF THE TRANSACTION IS MATERIAL TO ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 6 THE DETERMINATION OF THE TAXABILITY THEREOF. IN VIE W OF THE PROVISIONS OF SECTION 2(24)(IV) READ WITH THE DECIS ION DISCUSSED ABOVE, I HOLD THAT THE BENEFIT DERIVED BY HER IS TA XABLE IN HER HANDS. I, THEREFORE, UPHOLD THE ADDITION OF RS. 3,4 9,023/- MADE BY THE AO. U/S 10(3) : IN THE CASE OF SMT. SUDHA BURMAN VS. COMMISSIONER OF INCOME-TAX 296 ITR 96 (DEL), THE HEAD NOTES READS A S UNDER: INCOME SCOPE OF SECTION 2(24) ASSESSEE WIFE OF MANAGING DIRECTOR OF COMPANY ASSESSEE TRAVELING WITH MANAG ING DIRECTOR TO FOREIGN COUNTRIES EXPENSES OF JOURNE Y BORNE BY COMPANY NO EVIDENCE THAT TRAVEL WAS FOR BUSINESS PURPOSES OF COMPANY AMOUNT SPENT BY COMPANY ASSESSABLE AS INCOME OF ASSESSEE INCOME-TAX ACT, 1961 S. 2(24). THE FACTS OF THE CASE OF THE ASSESSEE ARE SIMILAR. THE ASSESSEE HAD VISITED FOREIGN COUNTRIES WITH HER HUSBAND AND THEREFORE, IN HER OWN CASE PROVISIONS OF SECTION 2(24)(IV) BECOME APPLICABLE AS SHE IS RELATIVE OF THE MANAGING DIRECTOR OF THE COMPANY NAMELY SKPMIL. NO EVIDENCE IS PLACED ON REWARD TO E STABLISH THAT THE VISIT OF THE ASSESSEE WAS FOR THE BUSINESS OF THE COMPANY CONCERNED. ACCORDING TO THESE PROVISIONS, T HE AMOUNTS INCURRED OF HER VISIT IS DULY CHARGEABLE TO TAX IN HER HANDS. IT IS IMMATERIAL IF THE SAID SUM INCURRED HA S BEEN OFFERED TO TAX IN THE HANDS OF THE COMPANY BECAUSE BOTH ARE OPERATING IN DISTINCT AND SEPARATE FIELDS. SO FAR AS THE CASE OF COMPANY IS CONCERNED, THE PROVISIONS OF SECTION 37(1) ARE APPL ICABLE TO DETERMINE THE INCOME CHARGEABLE TO TAX UNDER THE HE AD BUSINESS OR PROFESSION WHILE IN THE CASE OF THE A SSESSEE CONCERNED, THE APPLICABILITY OF THE PROVISIONS OF S ECTION 2(24) IS OF RELEVANCE. IN VIEW OF THE ABOVE, THE CONTENTION OF THE LD. AR OF THE ASSESSEE IS NOT ACCEPTED. IN THIS BACKDROP, I HOLD THAT THE ACTION OF THE AO IN TAXING THE AMOUNT INCURRED IS JUSTIFIABLE IN TERMS OF PROVISIO NS OF SECTION 2(24)(IV). THE AO HAS ALREADY ALLOWED THE BENEFIT O F DEDUCTION U/S 10(3) OF RS. 5,000/- TOWARDS THE CASUAL AND NON -RECURRING ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 7 INCOME AND THEREFORE, I AM OF THE OPINION THAT THE APPELLANT IS NOT ENTITLED TO RECEIVE ANY FURTHER RELIEF ON THIS ACCOUNT. THE ADDITION OF RS. 83,320/- MADE BY THE AO IS, THEREFO RE, UPHELD. 6.3. AGAINST THE AFORESAID ACTION OF THE CIT(A), CO NFIRMING THE ADDITIONS, THE ASSESSEE IS IN APPEAL BEFORE THE ITAT. 6.4. THE CIT(A), HOWEVER, DELETED THE ADDITION IN R ESPECT OF CASH CREDIT BY FOLLOWING OBSERVATION: 7.9.4. IT IS ALSO SEEN FROM THE REPLY OF THE ASSES SEE THAT A REQUEST WAS MADE TO EXAMINE THE BROKERS WHO HAD PUT THEIR STAMPS ON THE SHARE-TRANSFER DEEDS WHICH ACCOMPANIE D THE SHARES PURCHASED BY THE ASSESSEE. THIS REQUEST WAS MADE TO THE AO DURING THE COURSE OF ASSESSMENT PROCEEDINGS, BUT IT APPEARS THAT NO ENQUIRIES IN THIS DIRECTION WERE CARRIED OU T BY THE AO TO DECIPHER THE TRUTH INTO THE MATTER, PARTICULARLY WH EN THERE WERE CLAIMS AND COUNTER CLAIMS INTO THE MATTER. 7.10. CONSIDERING THE FACTS OF THE CASE IN TOTALITY , PARTICULARLY THE FACTS THAT THE APPELLANT IS IN POSSESSION OF OR IGINAL BILLS ISSUED BY THE ENTITIES CONCERNED CONTROLLED BY SHRI U.R. BHANDARI; THAT SHRI BHANDARI HA NOT PRODUCED THE SO CALLED BILL [CLAIMED TO HAVE BEEN ISSUED BY HIM] IN ORIGINAL BE FORE THE AO; THAT THE SIGNATURE OF SHRI BHANDARI TALLY WITH THE SIGNATURE ON THE BILLS PRODUCED BY THE APPELLANT AND ARE CERTIFI ED SO BY THE HAND WRITING EXPERT THAT THE AO DID NOT CARRY OUT WORTHWHILE ENQUIRIES OF EXAMINING THE BOOKS OF ACCOUNT OF THE ENTITIES CONCERNED; THAT AO EVEN DID NOT ASCERTAIN THE ASSES SMENT PARTICULAR OF SHRI BHANDARI AND HIS ENTITIES IN THE STATEMENT; THAT AO DID NOT CONSULT THE RETURNS OF INCOME IF ANY, FI LED BY SHRI BHANDARI OR THE ENTITIES CONCERNED; THAT THE AO DID NOT VENTURE INTO THE VERIFICATION OF THE MATTER THROUGH THE BRO KERS CONCERNED; IT CANNOT BE CONCLUSIVELY SAID THAT PURC HASE OF SHARES AND PAYMENT OUTSTANDING FOR THE SAME IS UNEX PLAINED IN NATURE. MOREOVER, THE AO HAS NOT TAKEN ANY CORRECTI VE STEPS TO BRING THE TRANSACTIONS IN LOGICAL CONSONANCE WITH H IS VIEWS INTO THE MATTER IN OTHER ASSESSMENT YEARS IN THE CASE OF THE ASSESSEE ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 8 ITSELF. IT IS ALSO NOTICED THAT THE ASSESSEE HAS BE EN DISCLOSING THE LIABILITIES TILL DATE IN HER RETURNS OF INCOME CONS ISTENTLY. IN THE LIGHT OF THE ABOVE, I HOLD THAT NO ADDITION ON THIS ACCOUNT CAN BE UPHELD IN THE CASE OF THE ASSESSEE AND ACCORDINGLY AO IS DIRECTED TO DELETE THE ADDITION SO MADE. 6.5. AGAINST THE AFORESAID ACTION OF THE CIT(A), DE LETING THE ADDITIONS, THE REVENUE IS IN APPEAL BEFORE THE ITAT. 7. LEARNED COUNSEL FOR THE ASSESSEE CONTENDS THAT A S FAR AS REVENUES APPEAL IS CONCERNED, CIT(A) HAS GIVEN THE RELIEF ON BOTH THE COUNTS I.E. THE CREDIT HAVING BEEN RECEIVED IN EARLIER YEAR, CANNOT BE ADDED IN THIS YEAR. BESIDES, ON MERIT ALSO IT HAS BEEN HELD THAT SHRI B HANDARIS STATEMENT IS NOT RELIABLE AS PROPER INQUIRIES WERE NOT CARRIED OUT B Y AO. THE CIT(A)S ORDER IS PERFECTLY JUSTIFIED. 7.1. COMING TO THE ASSESSEES APPEAL, LEARNED COUNS EL FOR THE ASSESSEE CONTENDS THAT IT IS NOT DISPUTED THAT THE ASSESSEE WAS A NON-EMPLOYEE DIRECTOR OF THE SAID COMPANY I.E. SKCSPL. THERE IS NO RELATI ON AT ALL OF EMPLOYER EMPLOYEE BETWEEN THE ASSESSEE AND SKCSPL, PROVISION S OF SEC. 17(2)/17(3) ARE NOT ATTRACTED. 7.2. LEARNED COUNSEL FURTHER CONTENDS THAT THE RELI ANCE PLACED BY THE CIT(A) ON MADRAS HIGH COURT JUDGMENT IN THE CASE O F RAVI PRAKASH KHEMKA VS. CIT 295 ITR 33 RELATES TO THE CREDIT CAR D PAYMENTS OF THE DIRECTORS. IT IS PLEADED THAT IN THE ABSENCE OF EMP LOYER-EMPLOYEE RELATIONSHIP, SEC. 17(3) IS NOT ATTRACTED IN THE AS SESSEES CASE. 7.3. COMING TO THE OTHER GROUND, LEARNED COUNSEL CO NTENDS THAT ASSESSEE IS THE WIFE OF MANAGING DIRECTOR OF SKPMIL. ON COMPANI ES REQUEST SHE ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 9 ACCOMPANIED HER HUSBAND ON HIS BUSINESS TOUR, WHOSE EXPENSES HAVE BEEN ALLOWED IN THE HANDS OF SKPMIL. THIS COMPANY ON ITS OWN OFFERED THE EXPENDITURE OF RS. 88,320/- FOR TAXATION. IT IS CON TENDED THAT IF THE ASSESSEE ACCOMPANIED HER HUSBAND AT THEIR REQUEST TO ACCOMPA NY THE MANAGING DIRECTOR ON HIS BUSINESS TOURS, THE EXPENDITURE INC URRED ON ASSESSEE CANNOT BE HELD TO BE CASUAL OR NON-RECURRING RECEIPT U/S 1 0(3) OF THE I.T. ACT. 8. LEARNED DR, ON THE OTHER HAND RELIES ON CIT(A)S ORDER IN CASE OF ASSESSEES APPEAL AND ON AOS ORDER IN CASE OF REVE NUES APPEAL. 9. WE HAVE HEARD RIVAL CONTENTIONS AND GONE THROUGH THE ENTIRE MATERIAL AVAILABLE ON RECORD. APROPOS ASSESSEES APPEAL, IT IS UNDISPUTED THAT THE CASH CREDITS HAVE COME FROM EARLIER YEAR AND WHAT IS REF LECTED IN THE BALANCE- SHEET IN THIS YEAR IS BY WAY OF OPENING BALANCE OF EARLIER YEAR. BESIDES, CIT(A) HAS HELD THAT MR. BHANDARIS STATEMENT WAS N OT RELIABLE IN THE EVENTUALITY OF LACK OF PROPER INQUIRIES. WE SEE NO INFIRMITY IN THE ORDER OF CIT(A)DELETING CASH CREDITS. ACCORDINGLY, REVENUES APPEAL IS DISMISSED. 10. APROPOS ASSESSEES APPEAL, IT HAS NOT BEEN DISP UTED THAT THERE WAS NO RELATIONSHIP OF EMPLOYER EMPLOYEE BETWEEN SKCSPL AN D THE ASSESSEE. A PERQUISITE U/S 17(2)/17(3) CAN BE ADDED IN THE HAND S OF THE ASSESSEE ONLY IF THE EMPLOYER EMPLOYEE RELATIONSHIP IS ESTABLISHED. IN THE ABSENCE THEREOF, THE ADDITION IN THE HANDS OF ASSESSEE U/S 17(2)/17( 3) CANNOT BE MADE. IN VIEW THEREOF, WE ALLOW THIS GROUND OF APPEAL TAKEN BY TH E ASSESSEE. 11. COMING TO THE SECOND GROUND ALSO, IT HAS NOT BE EN DISPUTED THAT THE EXPENSES OF THE ASSESSEES HUSBAND, WHO IS MANAGING DIRECTOR OF THE PAPER MILL, HAS BEEN ALLOWED AS BUSINESS EXPENDITURE IN T HAT CASE. BESIDES, THIS ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 10 COMPANY HAS OFFERED TO TAX THE EXPENDITURE ATTRIBUT ABLE TO ASSESSEE AS COMPANION TO HER HUSBAND AND HAS BEEN ADDED BACK IN THE HANDS OF THE COMPANY. THE PRESENCE OF WIFE WILL BE OF HELP TO TH E MANAGING DIRECTOR, WHOSE EXPENSES ARE HELD TO BE FOR THE PURPOSE OF BU SINESS. SINCE THE ASSESSEE ACCOMPANIED HER HUSBAND ON THEIR REQUEST, IT CANNOT BE HELD THAT THE AMOUNT OF RS. 88,320/- IS CASUAL OR NON-RECURRING I NCOME IN THE HANDS OF THE ASSESSEE. IN VIEW THEREOF, THIS ADDITION ALSO DESER VES TO BE DELETED. CONSEQUENTLY, THIS GROUND OF APPEAL TAKEN BY THE AS SESSEE IS ALSO ALLOWED. 12. IN THE RESULT, REVENUES APPEAL IS DISMISSED AN D ASSESSEES APPEAL IS ALLOWED. ORDER PRONOUNCED IN OPEN COURT ON 14-10-2011. SD/- SD/- (K.G. BANSAL ) ( R.P. TOLANI) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 14-10-2011. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR ITA 3204 & 3208/DEL/09 SMT. SHILPA PASARI VS. ITO 11