The ITO, Ward-2(3), Baroda V. M/s. Relax Pharmaceuticals, Baroda

ITA 4254/AHD/2007

• Counselvise Citation: [2010] 135 COUNSELVISE.COM (IT) 9351 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 11 month(s) 27 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 30-11-2010
• Appeal Filed By: Department
• Order Result: Allowed
• Bench Allotted: D
• Next Hearing Date: 09-11-2010
• Assessment Year: 2003-2004
• Appeal Filed On: 03-12-2007
• Result in Favour of: Revenue
• Court: TRIBUNAL
• Department Lawyers: ABHIJEET KUMAR N
• Keywords: Gift; Depreciation; Additional evidence
• Section: 192; 32

Judgement Text

- 1 - IN THE INCOME TAX APPELLATE TRIBUNAL AHMEDABAD BENCH D AHMEDABAD BEFORE S/SHRI MUKUL KUMAR SHRAWAT, JM AND D.C.AGRAW AL, AM INCOME-TAX OFFICER, WARD 2(2), BARODA. VS. M/S RELAX PHARMACEUTICALS, 862/1, GIDC ESTATE, MAKARPURA, BARODA. (APPELLANT) .. (RESPONDENT) AND M/S RELAX PHARMACEUTICALS, 862/1, GIDC ESTATE, MAKARPURA, BARODA. VS. INCOME-TAX OFFICER, WARD- 2(2), BARODA. (APPELLANT) .. (RESPONDENT) REVENUE BY :- SHRI ABHIJEET KUMAR N., DR ASSESSEE BY:- SHRI MEHUL THAKKAR, AR O R D E R PER D.C. AGRAWAL, ACCOUNTANT MEMBER . THESE ARE TWO CROSS APPEALS ONE FILED BY THE REVEN UE AND THE OTHER BY THE ASSESSEE AGAINST THE ORDER OF LD. CIT(A) DAT ED 3.9.2007. ITA NO.4254/AHD/2007 ASST. YEAR 2003-04 (REVENUES APPEAL) 2. THE REVENUE HAS RAISED FOLLOWING GROUNDS :- ITA NO.4254/AHD/2007 ASST. YEAR :2003-04 ITA NO.4310/AHD/2007 ASST. YEAR :2003-04 ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 2 1(A) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) ERRED IN ALLOWING DEPRECIATION ON THE CAR PURCHASED ON 29.03.2003 AND REGISTERED WITH THE TRANSPORT AUTHORITIES ON 31 .03.2003 I.E. THE LAST DATE OF THE PREVIOUS YEAR, WHEN THE ROAD TAX W AS PAID ON 03.04.2003 AND HENCE IT COULD NOT LEGALLY BE USED F OR THE PURPOSES OF THE ASSESSEES BUSINESS ON 31.03.2003 OR BEFORE, NOR WAS THERE ANY EVIDENCE FOR SUCH USER. (B) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) FAILED TO APPRECIATE THE LEGAL POSITION THAT BEING READY FOR USER IS NOT THE SAME AS ACTUAL USER IN COMMERCIAL SENSE FOR PRODUCING INCOME, WHICH IS A NECESSARY CONDITION FOR SECTION 32 AS SETTLED BY THE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS . SUHRID GEIGY LTD. 133 ITR 884 (GUJ) AND ADDL. CIT VS. SPECIALITY PAPER LTD. 133 ITR 879 (GUJ) AS ALSO BY OTHER HIGH COURTS, VIZ . 214 ITR 192 (BOM), 231 ITR 798 (MP AND 267 ITR 768 (BOM). 2(A) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, THE LD. CIT(A) ERRED IN DELETING THE ADDITION OF RS.5,41,916/- BEI NG THE CASH DEPOSITED IN THE BANK ACCOUNT WITHOUT THERE BEING C ORRESPONDING ENTRY IN THE CASH BOOK, ON THE BASIS OF ADDITIONAL EVIDENCE REGARDING SALES PRODUCED BEFORE HIM FOR THE FIRST T IME WITHOUT APPRECIATING THAT THE ABSENCE OF RELEVANT ENTRY IN THE CASH BOOK COULD NOT BE EXPLAINED BY MERE EVIDENCE OF SALES WI THOUT PROVING ACTUAL RECEIPT OF SALE PROCEEDS ON THE DATES OF DEP OSIT AS ALSO THE REASON FOR THE ABSENCE OF ENTRY IN THE CASH BOOK ON EACH RELEVANT DATE OF RECEIPT, OTHERWISE, IT COULD NOT BE THE SAM E CASH AS DEPOSITED IN THE BANK ACCOUNT. (B) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CA SE, THE LD. CIT(A) ERRED IN ADMITTING ADDITIONAL EVIDENCE IN CONTRAVEN TION OF RULE 46A WHEN THE ASSESSEE WAS GIVEN SPECIFIC OPPORTUNITY BY THE AO BY ISSUING NOTICE ON 16.3.2006 AND THE ASSESSEE HAD AL SO SUBMITTED A VAGUE REPLY ON 23.03.2006 WITHOUT AT ALL EXPLAINING THE ABSENCE OF ENTRY IN THE CASH BOOK AND WITHOUT PRODUCING ANY EV IDENCE WHATSOEVER. ITA NO.4310/AHD/2007, ASST. YEAR 2003-04 (ASSESSEE S APPEAL) WHEREAS THE ASSESSEE HAS RAISED THE FOLLOWING GROUN DS :- (1) THE ORDER OF THE LD. COMMISSIONER (APPEALS) IS AGAI NST LAW AND FACTS. ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 3 (2) THE LD. CCOMMISSIONER(APPEALS) ERRED IN CONFIRMING DISALLOWANCE OF RS.233801/- BEING EXPENDITURE ON AV AILING MANPOWER REQUIREMENTS FROM THE LABOUR CONTRACTOR M/ S SHAMBHU SERVICES. (3) THE LD. COMMISSIONER (APPEALS) ERRED IN CONFIRMING DISALLOWANCE OF RS.10000/- OUT OF EXPENDITURE ON OF FICE EXPENSES. (4) THE LD. COMMISSIONER (APPEALS) ERRED IN CONFIRMING DISALLOWANCE OF RS.2448/- BEING EXPENDITURE ON STAT IONERY. (5) THE LD. COMMISSIONER (APPEALS) ERRED IN CONFIRMING DISALLOWANCE OF RS.112420/- BEING EXPENDITURE ON PU RCHASE OF GIFT ARTICLES. (6) THE LD. COMMISSIONER (APPEALS) ERRED IN CONFIRMING DISALLOWANCE OF RS.8766/- BEING EXPENDITURE ON TELE PHONE. (7) THE LD. COMMISSIONER (APPEALS) ERRED IN CONFIRMING ADDITION OF RS.760500/- BEING VARIOUS AMOUNTS CREDITED IN CASH BOOK. (8) THE LD. COMMISSIONER (APPEALS) ERRED IN CONFIRMING ADDITION (SUBJECT TO ELIMINATION OF REPEATED ADDITION) OF RS .308281/- ON ACCOUNT OF CASH WITHDRAWN FROM BANK. 3. THE FACTS OF THE CASE ARE THAT ASSESSEE IS A PAR TNERSHIP FIRM ENGAGED IN THE BUSINESS OF MANUFACTURE OF PHARMACEUTICAL FO RMULATIONS, I.E. TABLETS, CAPSULES AND LIQUIDS SINCE 1994 AT BARODA. IT IS CLAIMED THAT ASSESSEE IS A VERY SMALL UNIT AS ITS TURNOVER IS AB OUT RS.1 CRORE. RETURN OF INCOME WAS FILED SHOWING INCOME OF RS.71,630/-. THE PROFIT AS PER PROFIT AND LOSS ACCOUNT WAS SHOWN AT RS.7,80,517/- AFTER A LLOWING DEPRECIATION, INTEREST AND REMUNERATION TO PARTNERS. REVENUES APPEAL 4. THE FIRST ISSUE IS WHETHER DEPRECIATION ON CAR C AN BE ALLOWED WHEN IT WAS REGISTERED ON 31.3.2003. THE CASE OF THE AO AND THAT OF LD. DR IS ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 4 THAT CAR WAS PURCHASED ON 29.3.2003 AND REGISTRATIO N WAS DONE ON 31.3.2003 WHEREAS ONE TIME ROAD TAX WAS PAID ON 3.4 .2003 AND, THEREFORE, CAR COULD NOT BE PUT TO USE BEFORE PAYING FULL ROAD TAX. THE CASE OF THE ASSESSEE IS THAT FOR REGISTERING THE VEHICLE ON 31. 3.2003 IT WAS USED AND PLIED ON THE ROAD. 5. WE HAVE HEARD THE PARTIES AND CAREFULLY PERUSED THE MATERIAL ON RECORD. THE ISSUE WHETHER THE CAR WAS PUT TO USE OR NOT WILL HAVE TO BE DECIDED BY EXPENDITURE INCURRED ON PETROL. ONCE THE CAR IS REGISTERED BY RTO IT CAN VERY WELL BE PLIED ON ROAD BUT THE FACT WHETHER IT WAS ACTUALLY PLIED OR NOT CAN BE FOUND OUT ONLY IF THERE IS AN E XPENDITURE ON RUNNING THE VEHICLE. THE MATTER IS, THEREFORE, REQUIRED TO BE RESTORED TO THE FILE OF AO. IN CASE EXPENDITURE IS INCURRED ON RUNNING THE VEHICLE IT SHOULD BE TREATED AS PUT TO USE AND CLAIM OF DEPRECIATION SHO ULD BE ALLOWED. THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 6. THE NEXT ISSUE IS REGARDING DEPOSITS MADE IN BAN K ACCOUNT TO THE EXTENT OF RS.5,41,916/- TREATED AS UNEXPLAINED BY T HE AO. THE CASE OF AO AND THE LD. DR IS THAT CASH WAS DEPOSITED IN THE BA NK ACCOUNT BUT THERE WAS NO CORRESPONDING ENTRY IN THE CASH BOOK. ON THE OTHER HAND, CASE OF THE ASSESSEE IS THAT MONEY WAS WITHDRAWN FROM CASH BOOK OUT OF SALE PROCEEDS. 7. WE HAVE HEARD THE PARTIES AND CAREFULLY PERUSED THE MATERIAL ON RECORD. THE IMPUGNED AMOUNT OF DEPOSITS IN BANK HAS BEEN MENTIONED BY THE AO ON PAGES 4,5 & 6 OF HIS ORDER. THERE IS A CL EAR FINDING THAT THE ASSESSEE HAS NOT EXPLAINED THE SOURCE. ON THE OTHER HAND, THE CASE OF THE LD. AR AND ASSESSEE IS THAT ASSESSEE HAS MADE SALES OUT OF WHICH MONEY WAS DEPOSITED IN THE BANK. THE ISSUE SEEMS TO HAVE NOT BEEN EXAMINED EITHER BY THE AO OR BY THE LD. CIT(A) BY ACTUALLY L OOKING INTO THE BOOKS. ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 5 IF THERE IS A DIRECT NEXUS OF EACH DEPOSIT IN THE B ANK ACCOUNT WITH THE CASH WITHDRAWAL FROM THE CASH BOOK SUCH DEPOSITS SHOULD BE TREATED AS EXPLAINED. THE ASSESSEE HAS TO SHOW THE NEXUS OF DE POSITS IN THE BANK AND WITHDRAWAL FROM THE BOOKS. SINCE ISSUE HAS NOT BEEN PROPERLY EXAMINED, WE RESTORE THE MATTER TO THE FILE OF AO TO FIND OUT WHETHER THERE IS ANY SUCH NEXUS. THIS GROUND OF REVENUE IS ALSO ALLOWED FOR STATISTICAL PURPOSES. 8. IN THE RESULT, APPEAL FILED BY THE REVENUE IS AL LOWED BUT FOR STATISTICAL PURPOSES. ASSESSEES APPEAL 9. THE FIRST ISSUE IN ASSESSEES APPEAL IS REGARDIN G EXPENDITURE OF RS.2,33,801/- BEING EXPENDITURE ON MANPOWER TAKEN F ROM LABOUR CONTRACTOR M/S SHAMBHU SERVICES. THE AO DISALLOWED THE CLAIM ON THE GROUND THAT EVIDENCE OF SERVICES RENDERED BY THE MA N POWER IS NOT FURNISHED. THE LD. CIT(A) ALSO CONFIRMED THE SAME F OR THE SAME REASONS. 10. WE HAVE HEARD THE PARTIES AND CAREFULLY PERUSED THE MATERIAL ON RECORD. THE CASE OF THE ASSESSEE IS THAT IT HAS BEE N REGULARLY DEPLOYING MAN POWER FOR THE PURPOSES OF MANUFACTURING ACTIVIT IES IN ITS FACTORY. SUCH CLAIM HAS BEEN MADE IN EARLIER YEARS AND HAS B EEN ALLOWED. THE ASSESSEE IS MAINTAINING REGULAR ATTENDANCE REGISTER OF THE WORKERS. THE CASE OF THE LD. DR IS THAT THERE IS NO EVIDENCE WHY SUCH MAN POWER WAS REQUIRED. 11. WE HAVE HEARD THE PARTIES AND CAREFULLY PERUSED THE MATERIAL ON RECORD. IN OUR CONSIDERED VIEW THERE MAY NOT ALWAYS AN EXACT EVIDENCE AVAILABLE OF SERVICES BEING RENDERED IN A SMALL FIR M. IF ASSESSEE IS MAINTAINING ATTENDANCE REGISTER OF THE WORKERS FOR WHOM PAYMENT HAS ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 6 BEEN MADE TO THE CONTRACTOR M/S SHAMBHU SERVICES TH EN IT IS PRIMA FACIE CASE IN FAVOUR OF THE ASSESSEE. FURTHER IF ASSESSEE IS DEPLOYING SUCH LABOUR FORCE IN THE EARLIER YEARS ALSO AND CLAIM OF EXPENDITURE HAS BEEN ACCEPTED BY THE DEPARTMENT THEN THERE IS NO CASE TO HOLD THIS YEAR THAT CLAIM IS NOT GENUINE. A COMPARATIVE STUDY OF THE EX PENDITURE IN LAST 3-4 YEARS SHOULD HAVE BEEN MADE AND FIND OUT WHETHER CL AIM IS REASONABLE OR NOT. THE LD. CIT(A) CALLED FOR THE REMAND REPORT BU T IN FACT ONLY CALLED FOR COMMENTS OF THE AO ON THE SUBMISSION MADE BY THE AS SESSEE WITHOUT GIVING COMPLETE POWER TO THE AO TO VERIFY AND ENQUI RE ABOUT THE GENUINENESS OF THE CASE. IN ANY CASE MATTER REQUIRE S TO BE RE-EXAMINED BY THE AO BY MAKING COMPLETE STUDY OF THE EXPENSES CLA IMED UNDER THIS HEAD IN EARLIER YEARS AND ALSO CALLING FOR THE EVID ENCE FROM THE ASSESSEE ABOUT THE NATURE OF WORK DONE BY VARIOUS PERSONS. A SSESSEE HAS TO SHOW RECORD AS TO ON WHAT DUTY THE WORK FORCE WAS DEPLOY ED. THE ASSESSEE HAS ALSO TO SHOW THE IDENTIFICATION OF THE PERSONS FOR WHICH PAYMENT WAS MADE BY THE ASSESSEE TO SHAMBHU SERVICES. CONSIDERI NG THE OVER ALL FACTS AND CIRCUMSTANCES OF THE CASE THE MATTER SHOULD BE REEXAMINED. ACCORDINGLY, WE RESTORE THIS ISSUE TO THE FILE OF A O. THIS GROUND IS ALLOWED FOR STATISTICAL PURPOSES. 12. GROUND NO.3 RELATES TO DISALLOWANCE OUT OF OFFI CE EXPENSES. THE AO DISALLOWED PART OF THE CLAIM ON THE GROUND THAT THEY ARE NOT VERIFIABLE. TOTAL CLAIM MADE BY THE ASSESSEE UNDER THIS HEAD WAS RS.89,048/-. THE AO DISALLOWED RS.17,810/- WHICH WA S REDUCED TO RS.10,000/- BY THE LD. CIT(A). AFTER HEARING THE PA RTIES WE HOLD THAT DISALLOWANCE IS REASONABLE AS ASSESSEE WAS NOT ABLE TO VERIFY THE EXPENDITURE. THIS GROUND OF ASSESSEE IS REJECTED. ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 7 13. GROUND NO.4 RELATES TO DISALLOWANCE OF RS.2,448 /- BEING EXPENDITURE ON STATIONERY. THE AO DISALLOWED THE CL AIM ON THE GROUND THAT EXPENSES FOR SENDING THE ENVELOPES BY COURIER ARE NOT RECORDED IN THE BOOKS. THE LD. CIT(A) CONFIRMED THE SAME. AFTER HEA RING THE PARTIES, WE DECLINE TO INTERFERE IN THE ORDER OF LD. CIT(A) AS ASSESSEE FAILED TO FURNISH NECESSARY EVIDENCE. THIS GROUND OF ASSESSEE IS REJE CTED. 14. NEXT GROUND IS REGARDING DISALLOWANCE OF RS.1,1 2,420/- BEING EXPENDITURE ON PURCHASES OF GIFT ARTICLES. THE AO F OUND THAT TOTAL CLAIM OF RS.1,12,420/- HAS BEEN MADE BY ASSESSEE BEING EX PENDITURE ON PURCHASE OF GIFT ARTICLES FROM CLASSIC BUSINESS GIF T. THE EXPENDITURE WAS INCURRED FOR PURCHASE OF SMALL ARTICLES LIKE KEY-CH AINS, LAMPS, WATCH, PENSTAND, DIARIES ETC. FOR GIVING TO DOCTORS AND ME DICAL STORES FOR THE PURPOSES OF PROMOTION OF PHARMACEUTICAL PREPARATION S. THE AO DISALLOWED THE CLAIM ON THE GROUND THAT THERE WAS N O EVIDENCE OF DISTRIBUTION OF THESE ITEMS AND ALSO THE PARTY FROM WHOM ALLEGED PURCHASES WERE CLAIMED TO HAVE BEEN MADE IS NOT FOU ND AT THE ADDRESS GIVEN. THE ASSESSEE SUBMITTED THAT THE PARTY HAS CL OSED THE BUSINESS. THE AO FURTHER FOUND THAT THERE IS A CREDIT BALANCE OF RS.1,01,276/- OUTSTANDING IN THE NAME OF CLASSIC BUSINESS GIFT AN D, THEREFORE, THE PURCHASE COULD NOT BE GENUINE. THE LD. AR SUBMITTED THAT THE PAYMENTS WERE MADE NEXT YEAR BY TWO ACCOUNT PAYEE CHEQUES FO R RS.34,944/- AND RS.66,332/-. NECESSARY COPIES OF BANK ACCOUNT WERE FURNISHED TO SHOW THE TRANSFER OF MONEY. 12. WE HAVE HEARD THE PARTIES. THE QUESTION WHETHER MONEY WAS ACTUALLY TRANSFERRED TO M/S CLASSIC BUSINESS GIFT H AS NOT BEEN PROPERLY EXAMINED. THE AO SHOULD ENQUIRE AND GIVE A FINDING AS TO WHETHER MONEY HAS ACTUALLY GONE TO THAT PARTY NEXT YEAR. SE CONDLY DETAILS ABOUT ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 8 ASSESSMENT OF THAT CONCERN SHOULD BE BROUGHT ON REC ORD AND FINDING BE GIVEN WHETHER THAT CONCERN IS ASSESSED TO TAX AND S ALES OF THESE ITEMS FOR WHICH AMOUNT WAS PAID BY THE ASSESSEE HAS BEEN REFL ECTED IN HIS RETURN. IF EVIDENCE TO THIS EXTENT IS BROUGHT ON RECORD OR SUB MITTED BY THE ASSESSEE THE CLAIM OF EXPENDITURE SHOULD BE ALLOWED. IF IDEN TITY OF M/S CLASSIC BUSINESS GIFT IS NOT ESTABLISHED THEN DISALLOWANCE NEED TO BE CONFIRMED. ACCORDINGLY, THE MATTER IS RESTORED TO THE FILE OF AO FOR DECIDING AFRESH. 13. GROUND NO.6 RELATES TO DISALLOWANCE OF EXPENDIT URE OF TELEPHONE EXPENSES AMOUNTING TO RS.8766/-.THE AO DISALLOWED T HE CLAIM OF EXPENDITURE IN THIS YEAR TO THE EXTENT OF RS.8766/- . AFTER HEARING THE PARTIES AND FINDING THAT THERE IS LACK OF EVIDENCE TO SHOW THAT EXPENDITURE WAS INCURRED FOR BUSINESS PURPOSES WE CONFIRM THE A DDITION. THIS GROUND IS REJECTED. 14. GROUND NO.7 IS REGARDING RS.7,60,500/-. THE AO FOUND THAT ASSESSEE HAS INTRODUCED CASH OF RS.7,60,500/- IN TH E CASH BOOK WHICH WAS NOT SATISFACTORILY EXPLAINED. IT WAS, HOWEVER, EXPL AINED TO THE AO THAT ASSESSEE IS GETTING CASH FROM CUSTOMERS AND IS DEPO SITED IN THE BANK ACCOUNT AS AND WHEN REQUIRED. SUCH RECEIPTS OF CASH IS NOT TREATED AS LOAN OR ADVANCE. 15. THE LD. CIT(A) CONFIRMED THE ADDITION FOR THE R EASON THAT SOURCE OF CASH INTRODUCED IN THE BOOK IS NOT EXPLAINED. IT WA S EXPLAINED BY THE LD. AR BEFORE US THAT ASSESSEE HAS BEEN ISSUING CHEQUES FOR WITHDRAWAL OF MONEY FROM THE BANK AND GIVES A SLIP TO THE ACCOUNT ANT. SLIPS CAN BE OF DIFFERENT DATES ACCORDING TO WHICH MONEY WAS RECORD ED IN THE CASH BOOK WHEREAS ACTUAL WITHDRAWAL FROM THE BANK WAS ON A LA TER DATE. HE ALSO SUBMITTED THAT LD. AO AND THE LD. CIT(A) VERIFIED O NLY TWO ENTRIES OUT OF RS.7,60,500/- WHEREAS THERE WERE SEVERAL ENTRIES. ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 9 16. HAVING HEARD THE PARTIES, WE RESTORE THE MATTER TO THE FILE OF AO TO GIVE FINDING AS TO THE DATES WHEN CASH WAS CREDITED IN THE CASH BOOK AND DATES WHEN CORRESPONDING MONEY WAS WITHDRAWN FROM T HE BANK. FURTHER WHETHER ANY CASH WAS INTRODUCED IN THE BOOKS PRIOR TO THE WITHDRAWAL FROM THE BANK AND FURTHER WHETHER SUCH WITHDRAWAL F ROM THE BANK WAS INVESTED ELSEWHERE. IF DURING THE PERIOD BETWEEN CR EDIT IN THE CASH BOOK AND WITHDRAWAL FROM THE BANK, MONEY IS NOT UTILIZED ANYWHERE BUT REMAINED LYING AS AN ENTRY IN THE CASH BOOK, THEN E XPLANATION OF THE ASSESSEE SHOULD BE ACCEPTED BUT ONLY TO THE EXTENT OF THOSE ENTRIES ONLY. BUT WHERE MONEY WAS CREDITED IN THE CASH BOOK BUT A LSO UTILIZED ELSEWHERE OR ANY EXPENDITURE OR PAYMENT OR INVESTME NT IS SHOWN IN THE BOOKS ON THE DEBIT SIDE, BUT ACTUAL WITHDRAWAL FROM THE BANK WAS ON LATER DATE THEN IT WOULD SHOW THAT ASSESSEE HAS INTRODUCE D UNACCOUNTED CASH AND UTILIZED IT EVEN THOUGH IT HAD ACTUALLY WITHDRA WN FROM THE BANK ON A MUCH LATER DATE. IN THAT EVENT ADDITION IS REQUIRED TO BE SUSTAINED. THE AO WILL GIVE FINDING IN RESPECT OF EACH WITHDRAWAL AND TAKE DECISION AS OBSERVED BY US. HE WILL ALSO GIVE BENEFIT OF PEAK A S WITHDRAWAL FROM THE BANK AT A LATER DATE WOULD REMAIN OUTSIDE THE BOOKS AND CAN BE UTILIZED FOR INTRODUCING IN THE BOOKS SUBSEQUENTLY ALSO. THE REFORE, TELESCOPING EFFECT IS REQUIRED TO BE GIVEN. THE AO WILL ENQUIRE AND GIVE FRESH FINDING. ACCORDINGLY, THIS ISSUE IS RESTORED TO THE FILE OF AO FOR FRESH ENQUIRY AND ADJUDICATION. THIS GROUND IS ALLOWED FOR STATISTICA L PURPOSES. 17. THE NEXT GROUND IS REGARDING ADDITION OF RS.3,0 8,281/- ON ACCOUNT OF CASH WITHDRAWAL FROM THE BANK. THIS GROUND IS SI MILAR TO GROUND NO.7 ABOVE AND THE AO HAS TO GIVE FINDING IN RESPECT OF EACH ITEM OF WITHDRAWAL IN THE SAME MANNER AS IN RESPECT OF GROU ND NO.7. HE WILL ALSO ITA NOS.4254 & 4310/AHD/2007 ASST. YEAR 2003-04 10 GIVE TELESCOPING EFFECT AS DISCUSSED ABOVE. THIS GR OUND IS RESTORED TO THE FILE OF AO AND THEREFORE ALLOWED FOR STATISTICAL PU RPOSES. 18. IN THE RESULT, THE APPEAL OF REVENUE IS ALLOWED FOR STATISTICAL PURPOSES AND THE APPEAL OF THE ASSESSEE IS PARTLY A LLOWED FOR STATISTICAL PURPOSES. ORDER WAS PRONOUNCED IN OPEN COURT ON 30.11.2010. SD/- SD/- (MUKUL KR. SHRAWAT) (D.C. AGRAWAL) JUDICIAL MEMBER ACCOUNTANT M EMBER AHMEDABAD, DATED : 30.11.10. MAHATA/- COPY OF THE ORDER FORWARDED TO :- 1. THE ASSESSEE. 2. THE REVENUE. 3. THE CIT(APPEALS)- 4. THE CIT CONCERNS. 5. THE DR, ITAT, AHMEDABAD 6. GUARD FILE. BY ORDER, DEPUTY / ASSTT.REGISTRAR ITAT, AHMEDABAD 1.DATE OF DICTATION 9/11/2010. 2.DATE ON WHICH THE TYPED DRAFT IS PLACED BEFORE TH E DICTATING 23/11/2010 MEMBER.OTHER MEMBER. 3.DATE ON WHICH THE APPROVED DRAFT COMES TO THE SR. P.S./P.S. 4.DATE ON WHICH THE FAIR ORDER IS PLACED BEFORE THE DICTATING MEMBER FOR PRONOUNCEMENT.. 5.DATE ON WHICH THE FAIR ORDER COMES BACK TO THE SR .P.S./P.S 6.DATE ON WHICH THE FILE GOES TO THE BENCH CLERK .. 7.DATE ON WHICH THE FILE GOES TO THE HEAD CLERK . 8.THE DATE ON WHICH THE FILE GOES TO THE ASSTT. REG ISTRAR FOR SIGNATURE ON THE ORDER 9.DATE OF DESPATCH OF THE ORDER..