DCIT, New Delhi V. M/s Splendid Builders Pvt. Ltd., New Delhi

ITA 3263/DEL/2011

• Counselvise Citation: 326320114 RSA 2011
• Duration Of Justice: 9 month(s) 13 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-03-2012
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: G
• Next Hearing Date: 14-03-2012
• Assessment Year: 2008-2009
• Appeal Filed On: 16-06-2011
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: S MOHANTY
• Keywords: Principle of natural justice; Transactions in derivatives; Speculation loss; Capital expenditure
• Section: 43(5); 12

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI G BENC H BEFORE SMT. DIVA SINGH, JM & SHRI A.N. PAHUJA, AM ITA NO.3263/DEL/2011 ASSESSMENT YEAR: 2008-09 DCIT, CIRCLE 9(1), ROOM NO.163, C.R. BUILDING,IP ESTATE,NEW DELHI V/S . M/S SPLENDED BUILDERS PVT. LTD., 110, BABAR ROAD, NEW DELHI [PAN : AAACS 2185 F] (APPELLANT) (RESPONDENT) ASSESSEE BY SHRI SALIL AGARWAL, AR REVENUE BY SMT. S. MOHANTY, DR DATE OF HEARING 14-03-2012 DATE OF PRONOUNCEMENT 30-03-2012 O R D E R A.N.PAHUJA:- THIS APPEAL FILED ON 16.06.2011 BY THE REVENUE AGAI NST AN ORDER DATED 11-03-2011 OF THE LD. CIT(A)-XII, DELHI, RAIS ES THE FOLLOWING GROUNDS:- 1. ON THE FACTS AND CIRCUMSTANCES OF THE CASE THE LEARNED CIT(A) ERRED IN LAW AND MERIT OF THE CASE IN DIRECTING THE ASSESSING OFFICER TO SET OFF SPECULATIVE LOSS OF ` `62,11,022/- PERTAINING TO ASSESSMENT YEAR 2007-08 AGAINST INCOME OF THE CURRENT YEAR. 2. THE APPELLANT CRAVES TO AMEND, MODIFY, ALTER, ADD OR FORGO ANY GROUND OF APPEAL AT ANY TIME BEFORE OR DURING THE HEARING OF THE APPEAL. 2. FACTS, IN BRIEF, AS PER RELEVANT ORDERS ARE THA T RETURN DECLARING INCOME OF ` ` 2,40,66,520/- FILED ON 29 TH SEPTEMBER, 2008 BY THE ASSESSEE, TRADING IN REAL ESTATE AND AGRO COMMODITIES VIZ. MENTHA OIL , JEERA, GUAR GUM, GUAR SEED, BLACK PEEPER, CARDAMOM ETC. IN COMMODITY EXCHANGES, WAS SELECTED FOR SCRUTINY I.T.A. NO.3263/DEL./2011 2 WITH THE SERVICE OF A NOTICE U/S 143(2) OF THE INCO ME-TAX ACT, 1961 (HEREINAFTER REFERRED TO AS THE ACT) ISSUED ON 3 RD AUGUST, 2009. DURING THE COURSE OF ASSESSMENT PROCEEDINGS, THE ASSESSING OFFICER (A.O. IN SHORT) NOTICED THAT THE ASSESSEE CLAIMED SET OFF OF SPECULATION LOSS OF ` `62,11,022/- AGAINST INCOME OF THE YEAR UNDER CONSIDERATION. TO A QUERY BY THE AO , THE ASSESSEE EXPLAINED THAT BESIDES OTHER ACTIVITIES, THEY WERE CARRYING ON F UTURE TRADING OF COMMODITIES ON COMMODITY EXCHANGE, WHICH WERE PERIODICALLY SETTLED OTHERWISE THAN BY ACTUAL DELIVERY OR TRANSFER OF COMMODITIES AND WERE COVERE D BY SECTION 43(5) OF THE ACT. ACCORDINGLY, THE ASSESSEE ARGUED THAT THEIR CLAIM W AS JUSTIFIED. HOWEVER, THE AO REJECTED THE CLAIM OF THE ASSESSEE ON THE GROUND THAT MEMORANDUM & ARTICLES OF ASSOCIATION DID NOT AUTHORIZE UNDERTAKING ANY SP ECULATION BUSINESS AND IN THE ABSENCE OF ANY EVIDENCE OF SPECULATION BUSINESS, SE T OFF OF BROUGHT FORWARD SPECULATION LOSS COULD NOT BE ALLOWED AGAINST INCOM E OF THE YEAR UNDER CONSIDERATION. 3. ON APPEAL, THE LD. CIT(A) ALLOWED THE CLAIM OF THE ASSESSEE IN THE FOLLOWING TERMS:- 5.4 THE APPELLANT HAS FURTHER STATED THAT IT IS NOT MATERIAL WHETHER THIS FACT THAT THE APPELLANT CAN CARRY OUT SPECULATION BUSINESS IN COMMODITY TRANSACTION IS MENTIONED IN M EMORANDUM AND ARTICLES OF ASSOCIATION. I AM IN AGREEMENT WIT H THE EXPLANATION OF THE APPELLANT BECAUSE WHAT IS MATERIAL FOR CONSI DERING WHETHER A TRANSACTION IS SPECULATIVE OR NOT IS WHETHER ULTIMA TELY IS WAS SETTLED WITH OR WITHOUT DELIVERY OF THE COMMODITY. THE ASS ESSING OFFICER HAS NOT BEEN ABLE TO REBUT THE SUBMISSION GIVEN BY THE APPELLANT THAT THE TRANSACTION WAS SETTLED WITHOUT ACTUAL DEL IVERY OF THE COMMODITIES. THUS, THE CONTENTION OF THE APPELLANT THAT THE NATURE OF THE BUSINESS CARRIED OUT IN THE EARLIER YEARS IS THE SAME WHICH HAS BEEN CARRIED OUT DURING THE YEAR HAS NOT BEEN C ONTROVERTED BY THE ASSESSING OFFICER. SINCE, SIMILAR TRANSACTION IN THE PRECEDING YEARS HAVE BEEN CONSIDERED AS SPECULATIVE IN NATURE THE SAME HAS TO BE CONSIDERED AS SPECULATIVE DURING THE CURRENT YEAR ALSO. 5.5 I HAVE GONE THROUGH THE SUBMISSIONS FILED BY TH E APPELLANT AND AGREE WITH THE FACT THAT THE ASSESSING OFFICER SHOULD HAVE SET OFF THE BROUGHT FORWARD SPECULATIVE LOSS AGAINST TH E CURRENT YEARS SPECULATIVE PROFIT. THE SAME CAN NOT BE DENIED MER ELY BECAUSE IT I.T.A. NO.3263/DEL./2011 3 IS NOT MENTIONED IN THE MEMORANDUM AND ARTICLE ASSO CIATION THAT THE APPELLANT COMPANY CAN ALSO CARRY OUT SPECULATIV E BUSINESS. LOOKING INTO THE ABOVE FACT THE ASSESSING OFFICER I S DIRECTED TO SET OFF SPECULATION LOSS OF ` ` 62,11,022/- AGAINST THE SPECULATION INCOME OF THE CURRENT YEAR. 4. THE REVENUE IS NOW IN APPEAL BEFORE US AGAINST THE AFORESAID FINDINGS OF THE LD. CIT(A). THE LD. DR WHILE SUPPO RTING THE ORDER OF AO CONTENDED THAT THE CASE OF THE ASSESSEE FALLS WITHIN CLAUSE ( C) OF PROVISO TO SECTION 43(5) OF THE ACT AND THUS, THE INCOME WAS NOT SPECULATIVE I N NATURE. THEREFORE, CLAIM FOR SET OFF OF SPECULATION LOSS OF THE PRECEDING YEAR A GAINST INCOME OF THE YEAR UNDER CONSIDERATION, WAS RIGHTLY DISALLOWED. ON THE OTHER HAND, THE LD. AR ON BEHALF OF THE ASSESSEE WHILE INVITING OUR ATTENTION TO THE A SSESSMENT ORDERS FOR THE PRECEDING YEARS, SUPPORTED THE FINDINGS OF THE LD. CIT(A). 5. WE HAVE HEARD BOTH THE PARTIES AND GONE THROUG H THE FACTS OF THE CASE. INDISPUTABLY, THE ASSESSEE REFLECTED PROFIT O F ` ` 3,86,58,648/- FROM COMMODITY TRADING IN THE YEAR UNDER CONSIDERATION AND SOUGHT SET OFF OF BROUGHT FORWARD SPECULATIVE LOSS OF ` `62,11,022/- AGAINST THE SAID INCOME IN THE YEAR UNDER CONSIDERATION. THE AO DISALLOWED THE CLAIM ON THE GROUND THAT THE MEMORANDUM & ARTICLES OF ASSOCIATION NOWHERE ENVISA GED SPECULATION BUSINESS IN COMMODITIES. HOWEVER, THE ASSESSMENT ORDER FOR T HE YEAR UNDER CONSIDERATION AND PRECEDING YEAR MENTION ABOUT THE BUSINESS OF TR ADING IN COMMODITIES. THE LD. CIT(A),WITHOUT EVEN ADVERTING TO THE RELEVANT P ROVISIONS OF THE ACT, ALLOWED THE CLAIM OF THE ASSESSEE FOR SET OFF OF ALLEGED BR OUGHT FORWARD LOSS AGAINST INCOME FOR THE YEAR UNDER CONSIDERATION ONLY ON THE GROUND THAT SINCE SIMILAR TRANSACTION IN THE PRECEDING YEARS HAVE BEEN CONSID ERED AS SPECULATIVE IN NATURE, THE SAME HAS TO BE CONSIDERED AS SPECULATIV E DURING THE CURRENT YEAR ALSO. IT WAS FURTHER CONCLUDED THAT THE SAME CAN NO T BE DENIED MERELY BECAUSE IT WAS NOT MENTIONED IN THE MEMORANDUM AND ARTICLES OF ASSOCIATION THAT THE ASSESSEE COMPANY CAN ALSO CARRY ON SPECULATIVE BUSI NESS. WE ARE OF THE OPINION THAT THE CIRCUMSTANCES WHETHER A TRANSACTI ON IS OR IS NOT WITHIN THE POWERS OF THE COMPANY, HAS NO BEARING ON THE NATURE OF THE TRANSACTION. THE I.T.A. NO.3263/DEL./2011 4 OBJECTS OF AN INCORPORATED COMPANY ENSHRINED IN THE MEMORANDUM ALONE ARE NOT CONCLUSIVE BUT OF COURSE ARE RELEVANT FOR THE PURPO SE OF DETERMINING THE NATURE AND SCOPE OF ITS ACTIVITIES. WHAT ARE THE ACTUAL AC TIVITIES UNDERTAKEN BY THE ASSESSEE AND WHETHER OR NOT THESE FALL WITHIN THE D EFINITION OF SPECULATIVE TRANSACTION AS DEFINED IN SEC. 43(5) OF THE ACT HAV E TO BE ANALYSED EVERY YEAR INDEPENDENTLY. IT CAN NOT BE SAID THAT SINCE TRANS ACTION IN A PARTICULAR COMMODITY IN THE PRECEDING YEAR WAS SPECULATIVE ,AS A COROLLA RY TRANSACTION IN THE YEAR UNDER CONSIDERATION WOULD ALSO BE SPECULATIVE IN NA TURE , AS CONCLUDED BY THE LD. CIT(A). HERE WE MAY HAVE A LOOK AT THE RELEVANT PRO VISIONS OF SEC. 43(5) OF THE ACT, WHICH READ AS UNDER: (5) 'SPECULATIVE TRANSACTION' MEANS A TRANSACTION IN WHICH A CONTRACT FOR THE PURCHASE OR SALE OF ANY COMMODITY, INCLUDING STOCKS AND SHARES, IS PERIODICALLY OR ULTIMATELY SE TTLED OTHERWISE THAN BY THE ACTUAL DELIVERY OR TRANSFER OF THE COMM ODITY OR SCRIPS: PROVIDED THAT FOR THE PURPOSES OF THIS CLAUSE- (A) A CONTRACT IN RESPECT OF RAW MATERIALS OR MERCHANDISE ENTERED INTO BY A PERSON IN THE COURSE OF HIS MANUFACTURING OR MERCHANTING BUSINESS TO GUARD AGAINST LOSS THROUGH FUTURE PRICE FLUCTUATIONS IN RESPECT OF HIS CONTRACTS FOR ACTUAL DELIVERY OF GOO DS MANUFACTURED BY HIM OR MERCHANDISE SOLD BY HIM; OR (B) A CONTRACT IN RESPECT OF STOCKS AND SHARES ENTE RED INTO BY A DEALER OR INVESTOR THEREIN TO GUARD AGAIN ST LOSS IN HIS HOLDINGS OF STOCKS AND SHARES THROUGH P RICE FLUCTUATIONS; OR (C) A CONTRACT ENTERED INTO BY A MEMBER OF A FORWAR D MARKET OR A STOCK EXCHANGE IN THE COURSE OF ANY TRANSACTION IN THE NATURE OF JOBBING OR ARBITRAGE T O GUARD AGAINST LOSS WHICH MAY ARISE IN THE ORDINARY COURSE OF HIS BUSINESS AS SUCH MEMBER; OR (D) AN ELIGIBLE TRANSACTION IN RESPECT OF TRADING I N DERIVATIVES REFERRED TO IN CLAUSE (AC) OF SECTION 2 OF THE SECU RITIES CONTRACTS (REGULATION) ACT, 1956 (42 OF 1956), CARR IED OUT IN A RECOGNISED STOCK EXCHANGE; I.T.A. NO.3263/DEL./2011 5 SHALL NOT BE DEEMED TO BE A SPECULATIVE TRANSACTION ; EXPLANATION. - FOR THE PURPOSES OF THIS CLAUSE, THE EXPRESSIONS - (I) 'ELIGIBLE TRANSACTION' MEANS ANY TRANSACTION,- (A) CARRIED OUT ELECTRONICALLY ON SCREEN-BASED SYST EMS THROUGH A STOCK BROKER OR SUB-BROKER OR SUCH OTHER INTERMEDIARY REGISTERED UNDER SECTION 12 OF THE SEC URITIES AND EXCHANGE BOARD OF INDIA ACT, 1992 (15 OF 1992), IN ACCORDANCE WITH THE PROVISIONS OF THE SECURITIES CO NTRACTS (REGULATION) ACT, 1956 (42 OF 1956), OR THE SECURIT IES AND EXCHANGE BOARD OF INDIA ACT, 1992 (15 OF 1992) OR T HE DEPOSITORIES ACT, 1996 (22 OF 1996) AND THE RULES, REGULATIONS OR BYE-LAWS MADE OR DIRECTIONS ISSUED U NDER THOSE ACTS OR BY BANKS OR MUTUAL FUNDS ON A RECOGNI SED STOCK EXCHANGE ; AND (B) WHICH IS SUPPORTED BY A TIME STAMPED CONTRACT N OTE ISSUED BY SUCH STOCK BROKER OR SUB-BROKER OR SUCH O THER INTERMEDIARY TO EVERY CLIENT INDICATING IN THE CONT RACT NOTE THE UNIQUE CLIENT IDENTITY NUMBER ALLOTTED UNDER ANY AC T REFERRED TO IN SUB-CLAUSE (A) AND PERMANENT ACCOUNT NUMBER A LLOTTED UNDER THIS ACT; (II) 'RECOGNISED STOCK EXCHANGE' MEANS A RECOGNISED STOCK EXCHANGE AS REFERRED TO IN CLAUSE (F) OF SECTION 2 OF THE SECURITIES CONTRACTS (REGULATION) ACT, 1956 (42 OF 1956), AND WHICH FULFILS SUCH CONDITIONS AS MAY BE PRESCRI BED AND NOTIFIED BY THE CENTRAL GOVERNMENT FOR THIS PURPOSE ; 5.1 THE RELEVANT PROVISIONS OF CARRY FORWARD AND SET OFF OF LOSSES IN SPECULATION BUSINESS READ UNDER: 73. LOSSES IN SPECULATION BUSINESS. (1) ANY LOSS, COMPUTED IN RESPECT OF A SPECULATION BUSINESS CARRIED ON BY THE ASSESSEE, SHALL NOT BE SET OFF EXCEPT AGAINST P ROFITS AND GAINS, IF ANY, OF ANOTHER SPECULATION BUSINESS. (2) WHERE FOR ANY ASSESSMENT YEAR ANY LOSS COMPUTED IN RESPECT OF A SPECULATION BUSINESS HAS NOT BEEN WHOLLY SET OFF UN DER SUB-SECTION (1), SO MUCH OF THE LOSS AS IS NOT SO SET OFF OR THE WHOLE LOSS WHERE THE ASSESSEE HAD NO INCOME FROM ANY OTHER SPECULATION BUSINESS, SHALL, SUBJECT TO THE I.T.A. NO.3263/DEL./2011 6 OTHER PROVISIONS OF THIS CHAPTER, BE CARRIED FORWAR D TO THE FOLLOWING ASSESSMENT YEAR, AND- (I) IT SHALL BE SET OFF AGAINST THE PROFITS AND GAI NS, IF ANY, OF ANY SPECULATION BUSINESS CARRIED ON BY HIM ASSESSABLE F OR THAT ASSESSMENT YEAR; AND (II) IF THE LOSS CANNOT BE WHOLLY SO SET OFF, THE A MOUNT OF LOSS NOT SO SET OFF SHALL BE CARRIED FORWARD TO THE FOLLOWING A SSESSMENT YEAR AND SO ON. (3) IN RESPECT OF ALLOWANCE ON ACCOUNT OF DEPRECIAT ION OR CAPITAL EXPENDITURE ON SCIENTIFIC RESEARCH, THE PROVISIONS OF SUB-SECTION (2) OF SECTION 72 SHALL APPLY IN RELATION TO SPECULATION B USINESS AS THEY APPLY IN RELATION TO ANY OTHER BUSINESS. (4) NO LOSS SHALL BE CARRIED FORWARD UNDER THIS SEC TION FOR MORE THAN FOUR ASSESSMENT YEARS IMMEDIATELY SUCCEEDING THE ASSESSM ENT YEAR FOR WHICH THE LOSS WAS FIRST COMPUTED. EXPLANATION.-WHERE ANY PART OF THE BUSINESS OF A CO MPANY (OTHER THAN A COMPANY WHOSE GROSS TOTAL INCOME CONSISTS MAINLY OF INCOME WHICH IS CHARGEABLE UNDER THE HEADS 'INTEREST ON SECURITIES' , 'INCOME FROM HOUSE PROPERTY', 'CAPITAL GAINS' AND 'INCOME FROM OTHER S OURCES', OR A COMPANY THE PRINCIPAL BUSINESS OF WHICH IS THE BUSINESS OF BANKING OR THE GRANTING OF LOANS AND ADVANCES) CONSISTS IN THE PURCHASE AND SALE OF SHARES OF OTHER COMPANIES, SUCH COMPANY SHALL, FOR THE PURPOS ES OF THIS SECTION, BE DEEMED TO BE CARRYING ON A SPECULATION BUSINESS TO THE EXTENT TO WHICH THE BUSINESS CONSISTS OF THE PURCHASE AND SALE OF S UCH SHARES. 5.2 WE MAY ALSO HAVE A LOOK AT THE RELEVANT PROVISIONS OF SEC. 80 OF THE ACT,WHICH READ AS UNDER: 80. SUBMISSION OF RETURN FOR LOSSES. NOTWITHSTANDING ANYTHING CONTAINED IN THIS CHAPTER, NO LOSS WHICH HAS NOT BEEN DETERMINED IN PURSUANCE OF A RETURN FILED IN ACCORD ANCE WITH THE PROVISIONS OF IED FORWARD IN THE PRECEDING YEARSECTION (1) OF SECTION 72 OR SUB-SECTION (2) OF SECTION 73 OR SUB-SECTION (1) OR SUB-SECTION (3) OF SECTION 74 OR SUB-SECTION (3) OF SECTION 74A . 5.3 A MERE GLANCE AT THE IMPUGNED ORDER REVEAL S THAT THE LD. CIT(A) DID NOT ADVERT TO ANY OF THE AFORESAID RELEVANT PROVISIONS OR EVEN THE ASSESSMENT ORDER FOR THE PRECEDING YEAR AND SIMPLY ACCEPTED THE SUBM ISSIONS OF THE ASSESSEE. I.T.A. NO.3263/DEL./2011 7 WHETHER OR NOT ALLEGED LOSS OF ` 62,11,022/- WAS DETERMINED ON ACCOUNT OF SPECULATION BUSINESS OR CARRIED FORWARD IN THE PREC EDING YEAR, HAS NOT BEEN ASCERTAINED NOR THE LD. CIT(A) ATTEMPTED TO GLANCE THROUGH THE ASSESSMENT ORDER FOR THE PRECEDING YEAR. THE ASSESSMENT ORDER FOR TH E AY 2007-08 NOWHERE ENVISAGES DETERMINATION OF ANY SPECULATION LOSS OR ITS CARRY FORWARD. EVEN IN THE YEAR UNDER CONSIDERATION, THERE IS NO FINDING IN TH E ASSESSMENT ORDER THAT THE ASSESSEE EARNED ANY PROFIT FROM THE BUSINESS OF SPE CULATION IN COMMODITIES. ASSUMING THAT CERTAIN TRANSACTIONS IN COMMODITIES WERE SPECULATIVE IN NATURE IN THE PRECEDING YEAR, DOES NOT IMPLY THAT THE TRANSA CTIONS IN THE YEAR UNDER CONSIDERATION ARE ALSO SPECULATIVE IN NATURE, AS HA S BEEN CONCLUDED BY THE LD. CIT(A).APPARENTLY, THE LD. CIT(A) HAVE NOT ANALYSED THE ISSUES IN PROPER PERSPECTIVE IN THE LIGHT OF RELEVANT PROVISIONS AND THE ORDER PASSED BY THE LD. CIT(A) IS CRYPTIC AND GROSSLY VIOLATIVE OF ONE OF THE FACETS OF THE RULES OF NATURAL JUSTICE, NAMELY, THAT EVERY JUDICI AL/QUASI-JUDICIAL BODY/AUTHORITY MUST PASS REASONED ORDER, WHICH SHOU LD REFLECT APPLICATION OF MIND BY THE CONCERNED AUTHORITY TO T HE ISSUES/POINTS RAISED BEFORE IT. THE APPLICATION OF MIND TO THE MA TERIAL FACTS AND THE ARGUMENTS SHOULD MANIFEST ITSELF IN THE ORDER. SECTION 250(6) OF THE ACT MANDATES THAT THE ORDER OF THE CIT(A) WHIL E DISPOSING OF THE APPEAL SHALL BE IN WRITING AND SHALL STATE THE POIN TS FOR DETERMINATION, THE DECISION THEREON AND THE REASONS FOR THE DECISION. THE REQUIREMENT OF RECORDING OF REASONS A ND COMMUNICATION THEREOF BY THE QUASI-JUDICIAL AUTHORI TIES HAS BEEN READ AS AN INTEGRAL PART OF THE CONCEPT OF FAIR PRO CEDURE AND IS AN IMPORTANT SAFEGUARD TO ENSURE OBSERVANCE OF THE RUL E OF LAW. IT INTRODUCES CLARITY, CHECKS THE INTRODUCTION OF EXTR ANEOUS OR IRRELEVANT CONSIDERATIONS AND MINIMIZES ARBITRARINE SS IN THE DECISION-MAKING PROCESS. HONBLE JURISDICTIONAL HIG H COURT IN THEIR DECISION IN VODAFONE ESSAR LTD. VS. DRP,196 TAXMAN423(DELHI) HELD THAT WHEN A QUASI JUDICIAL AUTHORITY DEALS WITH A LIS, IT IS OBLIGATORY ON IT S PART TO ASCRIBE COGENT AND GERMANE REASONS AS THE SAME IS THE HEART AND SOUL O F THE MATTER AND FURTHER, THE I.T.A. NO.3263/DEL./2011 8 SAME ALSO FACILITATES APPRECIATION WHEN THE ORDER I S CALLED IN QUESTION BEFORE THE SUPERIOR FORUM. WE MAY POINT OUT THAT A DECISION DOES NOT MERELY MEAN THE CONCLUSION. IT EMBRACES WITHIN ITS FOLD THE REASONS FORMING BASIS FOR THE CONCLUSION.[MUKHTIAR SINGH VS . STATE OF PUNJAB,(1995)1SCC 760(SC)]. 6.. IN VIEW OF THE FOREGOING, ESPECIALLY WHEN T HE LD. CIT(A) HAVE NOT PASSED A SPEAKING ORDER ON THE ISSUE RAISED IN THIS APPEAL BEFORE US, WE CONSIDER IT FAIR AND APPROPRIATE TO SET ASIDE THE ORDER OF THE LD. CIT(A) AND RESTORE THE MATTER TO HIS FIL E FOR DECIDING THE AFORESAID ISSUE, AFRESH IN ACCORDANCE WITH LAW IN THE LIGHT OF OUR AFORESAID OBSERVATIONS, AFTER ALLOWING SUFFICIENT O PPORTUNITY TO BOTH THE PARTIES. NEEDLESS TO SAY THAT WHILE REDECIDING THE APPEAL, THE LD. CIT(A) SHALL PASS A SPEAKING ORDER, KEEPING IN MIND , INTER ALIA, THE MANDATE OF PROVISIONS OF SEC. 250(6) OF THE ACT. W ITH THESE OBSERVATIONS, GROUND NO. 1 IN THE APPEAL OF THE REV ENUE IS DISPOSED OF. 7. NO ADDITIONAL GROUND HAVING BEEN RAISED BEFORE US IN TERM OF RESIDUARY GROUND NO.2 IN THE APPEAL , ACCORDINGLY, THIS GROU ND IS DISMISSED. 8. NO OTHER PLEA OR ARGUMENT WAS MADE BEFORE US. 9. IN THE RESULT, APPEAL IS ALLOWED BUT FOR S TATISTICAL PURPOSES. SD/- SD/- (DIVA SINGH) (A.N. PAHUJA) (JUDICIAL MEMBER) (ACCOUNTANT MEMBER) ORDER PRONOUNCED IN OPEN COURT I.T.A. NO.3263/DEL./2011 9 NS COPY OF THE ORDER FORWARDED TO :- 1. M/S SPLENDED BUILDERS PVT. LTD., 110, BABAR RD., NEW DELHI. 2. DCIT, CIRCLE 9(1), ROOM NO.163, C.R. BUILDING, N EW DELHI 3. CIT CONCERNED 4. CIT(A)-XII, NEW DELHI 5. DR, ITAT,G BENCH, NEW DELHI 6. GUARD FILE. TRUE COPY BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, DELHI