SMT. SANTOSH GUPTA, JAIPUR V. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-6, JAIPUR

ITA 495/JPR/2019

• Counselvise Citation: [2021] 109 COUNSELVISE.COM (IT) 7733 (ITAT-JAIPUR)
• Duration Of Justice: 1 year(s) 9 month(s) 11 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 20-01-2021
• Appeal Filed By: Assessee
• Order Result: Allowed
• Bench Allotted: A
• Assessment Year: 2010-2011
• Appeal Filed On: 09-04-2019
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: SANDEEP TANEJA
• Keywords: Reopening of assessment; Opportunity of being heard; Principle of natural justice; Transactions in derivatives; Reassessment proceedings; Set aside
• Section: 143(3); 142(1); 133A; 143(1); 143(2); 147; 148

Judgement Text

VK;DJ VIHYH; VF/KDJ.K] T;IQJ U;K;IHB] T;IQJ IN THE INCOME TAX APPELLATE TRIBUNAL, JAIPUR BENC HES A JAIPUR JH LAANHI XKSLKBZ] U;KF;D LNL; ,OA JH FOE FLAG ;KNO] YS[KK LNL; DS LE{K BEFORE: SHRI SANDEEP GOSAIN, JM & SHRI VIKRAM SING H YADAV, AM VK;DJ VIHY LA- @ ITA NO. 495/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR : 2010-11 SMT. SANTOSH GUPTA 3-TA-42, JAWAHAR NAGAR, JAIPUR CUKE VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-06, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: AAPPG4778A VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT VK;DJ VIHY LA- @ ITA NO. 496/JP/2019 FU/KZKJ.K O'K Z @ ASSESSMENT YEAR :2010-11 SHRI VISHNU KUMAR GUPTA 3-TA-42, JAWAHAR NAGAR, JAIPUR-302004 CUKE VS. DEPUTY COMMISSIONER OF INCOME TAX, CIRCLE-06, JAIPUR LFKK;H YS[KK LA-@THVKBZVKJ LA-@ PAN/GIR NO.: ADOPG9230B VIHYKFKHZ@ APPELLANT IZR;FKHZ@ RESPONDENT FU/KZKFJRH DH VKSJ L S@ ASSESSEE BY : SH. SANDEEP TANEJA (CA) JKTLO DH VKSJ LS @ REVENUE BY : SMT. RUNI PAL (ADDL.CIT) LQUOKBZ DH RKJH[ K@ DATE OF HEARING : 22/10/2020 MN?KKS'K.KK DH RKJH[ K@ DATE OF PRONOUNCEMENT: 20/01/2021 VKNS'K@ ORDER PER: VIKRAM SINGH YADAV, A.M. THESE ARE TWO APPEALS FILED BY THE RESPECTIVE ASSES SEES AGAINST THE ORDERS OF LD. CIT(A), AJMER DATED 08.01.2019 FOR A. Y 2010-11. SINCE THE COMMON ISSUES ARE INVOLVED, BOTH THESE APPEALS WERE HEARD TOGETHER AND ARE BEING DISPOSED OFF BY THIS CONSOLIDATED ORDER. ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 2 2. WITH THE CONSENT OF BOTH THE PARTIES, THE CASE O F SMT. SANTOSH GUPTA, IN ITA NO. 495/JP/2019 IS TAKEN AS THE LEAD CASE FOR T HE PURPOSES OF PRESENT DISCUSSION WHEREIN THE ASSESSEE HAS TAKEN THE FOLLO WING GROUNDS OF APPEAL: 1. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) GROSSLY ERRED IN SUSTAINING THE ADDITION OF RS. 1,47,000/- HOLDING MISUSE OF CLIENT CODE WITHOUT THERE BEING ANY DOCUM ENT OR MATERIAL WHICH COULD ESTABLISHED THAT THE CLIENT CODE MODIFI CATION WAS MADE WHICH ALLEGEDLY RESULTED IN SHIFTING OF PROFIT. 2. THAT IN THE FACTS AND CIRCUMSTANCES OF THE CASE AND IN LAW, THE CIT(A) GROSSLY ERRED IN SUSTAINING THE ADDITION OF RS. 2,940/- AS COMMISSION ALLEGEDLY PAID BY THE APPELLANT TO THE B ROKER WITHOUT THERE BEING ANY MATERIAL ON RECORD WHICH COULD ESTABLISHE D THAT THE SAID AMOUNT WAS PAID BY THE APPELLANT TO THE BROKER. 3. BECAUSE THE CIT(A) HAS ERRED IN NOT CONSIDERING THAT THE ASSESSING OFFICER HAD COMMITTED JURISDICTIONAL ERROR IN ISSUI NG NOTICE UNDER SECTION 148 OF THE INCOME TAX ACT MERELY ON SUSPICIOUS. THE RE WAS NO MATERIAL AVAILABLE WITH THE ASSESSING OFFICER FOR FORMATION OF NECESSARY BELIEF. THE NOTICE ISSUED MERELY ON THE BASIS OF THE INFORMATIO N RECEIVED FROM ADIT (INV.), UNIT 1(3) AHMEDABAD WAS BAD AND INVALID. 4. THAT THE CIT(A) GROSSLY ERRED IN CONSIDERING THA T THE ASSESSING OFFICER HAD PASSED THE ORDER IN GROSS VIOLATION OF PRINCIPLE OF NATURAL JUSTICE. THE ASSESSING OFFICER HAD PASSED THE ORDER WITHOUT PROVIDING COPIES OF THE MATERIAL RELIED UPON BY HIM. THE ASSE SSING OFFICER DID NOT PROVIDE THE INFORMATION RECEIVED FORM ADIT(INV.) UN IT 1(3) AHMEDABAD, COPIES OF THE STATEMENT OF THE BROKERS AND THE CLIE NTS WHO HAD ALLEGEDLY CONFIRMED MISUSE OF CLIENT CODE MODIFICATION FACILI TY. 5. THAT THE CIT(A) ERRED IN NOT CONSIDERING THAT TH E ASSESSING OFFICER FAILED TO PROVIDE OPPORTUNITY OF PERSONAL HEARING T O THE APPELLANT BEFORE ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 3 PASSING THE ASSESSMENT ORDER. FURTHER, THE CIT(A) A LSO ERRED IN NOT CONSIDERING THAT DESPITE SPECIFIC REQUEST, THE ASSE SSING OFFICER FAILED TO PROVIDE OPPORTUNITY TO THE APPELLANT TO CROSS EXAMI NE THE BROKERS AND THE CLIENTS. 6. THAT THE CIT(A) ERRED IN REJECTING THE GROUNDS R ELATING TO VALIDITY OF REOPENING OF ASSESSMENT UNDER SECTION 147 AND IS SUANCE OF NOTICE UNDER SECTION 148 WITHOUT ASSIGNING ANY REASON. THE IMPUGNED ORDER BEING AN UNREASONED ORDER DESERVES TO BE SET ASIDE. 3. BRIEFLY STATED THE FACTS OF THE CASE ARE THAT TH E ASSESSEE HAS FILED HER ORIGINAL RETURN OF INCOME ON 30.03.2011 DECLARING T OTAL INCOME OF RS. 54,03,120/- WHICH WAS PROCESSED U/S 143(1) OF T HE ACT. SUBSEQUENTLY, THE NOTICE U/S 148 WAS ISSUED ON 27.03.2017 AFTER RECOR DING REASONS TO BELIEVE THAT INCOME AMOUNTING TO RS. 1,49,950/- HAS ESCAPED ASSESSMENT WITHIN THE MEANING OF SECTION 147 OF THE ACT. IN RESPONSE, THE ASSESSEE FILED HER RETURN OF INCOME ON 10.04.2017 AT TOTAL INCOME OF RS. 54,03,1 20/- AS ORIGINALLY FILED. SUBSEQUENTLY, THE NOTICE U/S 143(2) AND 142(1) WERE ISSUED AND THE ASSESSMENT WAS COMPLETED U/S 143(3) READ WITH SECTI ON 147 AT AN ASSESSED INCOME OF RS. 55,53,060/- HOLDING THAT THE ASSESSEE HAS MISUSED FACILITY OF CLIENT CODE MODIFICATION AND SHE HAS SHIFTED-IN CON TRIVED LOSS OF RS. 1,47,000/- AND IN THIS WAY, SHE HAS REDUCED HER TAXABLE INCOME . FURTHER, AN AMOUNT OF RS. 2,940/- WAS ALSO ADDED TOWARDS COMMISSION PAID @ 2% ON SUCH ACCOMMODATION TO THE BROKERS. BEING AGGRIEVED, THE ASSESSEE CARRIED THE MATTER IN APPEAL BEFORE THE LD. CIT(A) WHO HAS SINC E CONFIRMED THE SAID ADDITION AND NOW THE ASSESSEE IS IN APPEAL BEFORE U S. 4. DURING THE COURSE OF HEARING, THE LD. AR RAISED THE VARIOUS CONTENTIONS CHALLENGING THE ASSUMPTION OF JURISDICTION U/S 147 AND THE ORDER SO PASSED BY THE AO U/S 147 R/W 143(3) OF THE ACT. ONE OF THE C ONTENTIONS WHICH HAS BEEN ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 4 RAISED BY THE LD AR IS THAT THE ORDER SO PASSED BY THE AO IS IN GROSS VIOLATION OF PRINCIPLE OF NATURAL JUSTICE. IT WAS SUBMITTED THA T THE NOTICE U/S 148 WAS ISSUED MERELY ON THE BASIS OF THE INFORMATION RECEI VED FROM THE ADIT (INV.) UNIT-1(3), AHMEDABAD. THE APPELLANT VIDE ITS LETTER DATED 08.05.2017, 14.11.2017, 20.11.2017 REPEATEDLY REQUESTED TO PROV IDE COPY OF THE INFORMATION RECEIVED FROM ADIT (INV.) UNIT-1(3), AH MEDABAD, HOWEVER THE LEARNED AO DID NOT PROVIDE THE SAME. IT WAS SUBMITT ED THAT THE APPELLANT ALSO VIDE ITS LETTER DATED 08.05.2017, 14.11.2017, 20.11 .2017 REPEATEDLY REQUESTED TO PROVIDE COPY OF THE STATEMENTS OF THE BROKERS AN D CLIENTS WHO ALLEGEDLY CONFIRMED MISUSE OF CLIENT CODE MODIFICATION FACILI TY. HOWEVER THE LEARNED AO DID NOT PROVIDE THE SAME. IT WAS SUBMITTED THAT THE APPELLANT VIDE ITS LETTER DATED 20.11.2017 (REPLY TO SCN) REQUESTED TO PROVID E OPPORTUNITY TO CROSS EXAMINE THE BROKERS AND CLIENTS, WHO ALLEGEDLY CONF IRMED MISUSE OF CLIENT CODE MODIFICATION FACILITY. HOWEVER THE LEARNED AO DID N OT PROVIDE THE OPPORTUNITY TO CROSS EXAMINE THE SAID BROKERS AND CLIENTS. FURTHER , THE APPELLANT VIDE ITS LETTER DATED 20.11.2017 (REPLY TO SCN) REQUESTED THE AO TO GRANT AN OPPORTUNITY OF PERSONAL HEARING BEFORE PASSING FINAL ORDER. HOWEVE R THE LEARNED AO PASSED THE ORDER ON THE NEXT DAY I.E. 21.11.2017 WITHOUT P ROVIDING OPPORTUNITY TO BE HEARD IN PERSON. IT WAS ACCORDINGLY SUBMITTED THAT THE LEARNED AO HAS PASSED THE ORDER IN GROSS VIOLATION OF NATURAL JUSTICE AND THEREFORE THE SAME DESERVES TO BE SET ASIDE. IT WAS FURTHER SUBMITTED THAT SIMI LAR CONTENTIONS WERE RAISED BEFORE THE LD. CIT(A) WHICH HE HAS SUMMARILY REJECT ED. IN SUPPORT OF HIS CONTENTION, THE LD. AR PLACED RELIANCE ON THE DECIS ION OF HONBLE SUPREME COURT IN CASE OF ANDAMAN TIMBER INDUSTRIES VS. COMMISSION ER OF C. EX., KOLKATA-II (2015) 281 CTR (SC) 241. 5. PER CONTRA, THE LD. DR SUBMITTED THAT IN THIS CA SE, INFORMATION WAS RECEIVED FROM ADIT (INV.) UNIT-1(3), AHMEDABAD. FRO M THE INFORMATION, IT WAS GATHERED BY THE AO THAT FICTITIOUS PROFITS AND LOSS ES, WERE CREATED BY SOME ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 5 BROKERS BY MISUSING THE CLIENT CODE MODIFICATION FA CILITY IN F&O SEGMENT ON NSE DURING THE F.Y 2009-10. THE BROKERS WERE ALLEGE D TO BE INDULGING IN TRANSFERRING THE FICTITIOUS LOSSES TO DIFFERENT CLI ENTS TO REDUCE THEIR TAX LIABILITY AND ALSO FICTITIOUS PROFIT TO OTHER CLIENTS. IN SOM E CASES OF BROKERS AS WELL AS CLIENTS, SURVEY U/S 133A WAS CARRIED OUT AND THEY C ONFIRMED HAVING MISUSED THE FACILITY OF CLIENT CODE MODIFICATION TO CREATE FICTITIOUS LOSSES/PROFITS AND IN TRANSFERRING PROFITS AND LOSSES FROM ORIGINAL CLIEN TS TO MODIFIED CLIENTS. FROM THE DETAILS RECEIVED, IT WAS NOTICED THAT DURING THE YE AR UNDER CONSIDERATION ASSESSEE HAS SHIFTED-IN ASCERTAINED LOSS OF RS. 1,4 7,000/-. IN THIS WAY, NET REDUCTION IN INCOME DUE TO MISUSE OF CLIENT CODE MO DIFICATION FACILITY COMES TO RS. 1,47,000/-. FOR TAKING IN SUCH CONTRIVED LOSSES THE ASSESSEE WOULD HAVE PAID COMMISSION ALSO. ON THE BASIS OF STATEMENT OF BROKERS, THE AO ESTIMATE THAT THE ASSESSEE WOULD HAVE PAID COMMISSION @ OF 2 % WHICH COMES TO RS. 2,940 OUT OF BOOKS OF ACCOUNTS. BASIS THE SAME, THE REASONS WERE RECORDED AND NOTICE U/S 148 WAS ISSUED TO THE ASSESSEE. IT WAS SUBMITTED THAT IN THIS CASE, LOSS OF RS. 1,47,000/- ON TRANSACTION OF SHAR ES OF NIFTY NO WAS ORIGINALLY ACCRUED TO M/S SANDEEP STOCKS PVT. LTD. AND THIS LO SS WAS SHIFTED TO THE ASSESSEE THROUGH HER BROKER M/S MAVERICK SHARE BROK ERS LIMITED. IT WAS SUBMITTED THAT SPECIFIC DETAILS WERE AVAILABLE WITH THE ASSESSING OFFICER WHICH WERE DULY SHARED WITH THE ASSESSEE AND OUR REFERENC E WAS DRAWN TO THE SHOW CAUSE NOTICE DATED 14.11.2017 ISSUED BY THE ASSESSI NG OFFICER IN THIS REGARD AND REASSESSMENT WAS COMPLETED BRINGING THE SAME TO TAX. THE LD DR ACCORDINGLY SUPPORTED THE ORDER OF THE LOWER AUTHOR ITIES. 6. WE HAVE HEARD THE RIVAL CONTENTIONS AND PERUSED THE MATERIAL AVAILABLE ON RECORD. WE FIND THAT THE AO HAS RELIED ON CERTAI N INFORMATION RECEIVED FROM ADIT (INV.) UNIT-1(3), AHMEDABAD AND SURVEY CONDUCT ED AT THE PREMISES OF CERTAIN BROKERS AND CLIENTS WHEREIN STATEMENTS OF T HESE PERSONS WERE RECORDED. DURING THE COURSE OF REASSESSMENT PROCEEDINGS, WE F IND THAT THE ASSESSEE HAS ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 6 REPEATEDLY ASKED THE ASSESSING OFFICER TO SHARE WIT H HER, COPY OF THE INFORMATION RECEIVED FROM ADIT (INV.) UNIT-1(3), AH MEDABAD, COPY OF THE STATEMENTS OF THE BROKERS AND CLIENTS AND HAVE ALSO ASKED FOR AN OPPORTUNITY TO CROSS-EXAMINE THESE PERSONS WHO HAVE ALLEGEDLY CONF IRMED MISUSE OF CLIENT CODE MODIFICATION FACILITY AS EVIDENT FROM VARIOUS COMMUNICATION/LETTERS WRITTEN TO THE AO AND PLACED ON RECORD. IT IS ALSO A FACT THAT THE AO HAVING ACKNOWLEDGED SAID COMMUNICATION AND REQUEST FROM TH E ASSESSEE HAS NOT ACTED UPON THE SAME AND HAS NOT SHARED SUCH INFORMA TION/STATEMENTS AND AN OPPORTUNITY TO CROSS-EXAMINE THESE PERSONS WAS ALSO NOT PROVIDED. IT IS A SETTLED LEGAL PROPOSITION AS LAID DOWN BY THE COURT S FROM TIME TO TIME THAT WHERE ANY THIRD PARTY MATERIAL OR STATEMENT OF ANY THIRD PARTY IS TO BE RELIED UPON BY THE REVENUE AGAINST THE ASSESSEE, THE LATTE R BE PROVIDED AN OPPORTUNITY WHEREBY SUCH INFORMATION AND STATEMENTS ARE SHARED AND THE ASSESSEE BE ALLOWED AN OPPORTUNITY TO PUT FORWARD H ER DEFENCE AND OBJECTIONS IN THIS REGARD. FURTHER, WHERE THE ASSESSEE SO DESI RES, AN OPPORTUNITY TO CROSS EXAMINE THE PERSONS WHOSE STATEMENTS ARE RECORDED B E PROVIDED TO THE ASSESSEE. HOWEVER, IN THE INSTANT CASE, WE FIND TH AT THE AO HAS NOT SHARED SUCH INFORMATION/STATEMENTS AND AN OPPORTUNITY TO C ROSS-EXAMINE THESE PERSONS WAS ALSO NOT PROVIDED AND THEREFORE, THE PR INCIPLE OF NATURAL JUSTICE IS CLEARLY VIOLATED IN THE INSTANT CASE WHICH RENDERS THE ORDER SO PASSED BY THE AO AS INVALID IN THE EYES OF LAW. WE FIND THAT EVEN D URING THE APPELLATE PROCEEDINGS, THE ASSESSEE WAS NOT MADE AVAILABLE AN Y SUCH STATEMENTS AND EVEN THE RIGHT OF CROSS EXAMINATION WAS DENIED BY T HE LD CIT(A) WHO EXERCISES THE CO-TERMINUS POWERS AS THAT OF THE AO. THUS, IN VIEW OF THE DECISION OF THE HONBLE SUPREME COURT IN CASE OF CCE VS. ANDAMAN TI MBER INDUSTRIES (SUPRA), THE ASSESSMENT BASED ON STATEMENT OF THIRD PARTY WI THOUT GIVING AN OPPORTUNITY TO THE ASSESSEE IS NOT SUSTAINABLE IN L AW. THE HONBLE SUPREME COURT IN CASE OF ANDAMAN TIMBER (SUPRA) WHILE DEALI NG WITH THE ISSUE HAS HELD IN PARA 5 TO 8 AS UNDER:- ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 7 '5. WE HAVE HEARD MR. KAVIN GULATI, LEARNED SENIOR COUNSEL APPEARING FOR THE ASSESSEE, AND MR. K. RADHAKRISHNANA, LEARNED SE NIOR COUNSEL WHO APPEARED FOR THE REVENUE. 6. ACCORDING TO US, NOT ALLOWING THE ASSESSEE TO CR OSS-EXAMINE THE WITNESS BY THE ADJUDICATING AUTHORITY THOUGH THE ST ATEMENTS OF THOSE WITNESSES WERE MADE THE BASIS OF THE IMPUGNED ORDER IS A SERIOUS FLAW WHICH MAKES THE ORDER NULLITY INASMUCH AS IT AMOUNT ED TO VIOLATION OF PRINCIPLES OF NATURAL JUSTICE BECAUSE OF WHICH THE ASSESSEE WAS ADVERSELY AFFECTED. IT IS TO BE BORNE IN MIND THAT THE ORDER OF THE COMMISSIONER AS BASED UPON THE STATEMENTS GIVEN BY THE AFORESAID TW O WITNESSES. EVEN WHEN THE ASSESSEE DISPUTED THE CORRECTNESS OF THE S TATEMENTS AND WANTED TO CROSS-EXAMINE, THE ADJUDICATING AUTHORITY DID NOT GRANT THIS OPPORTUNITY TO THE ASSESSEE. IT WOULD BE PERTINENT TO NOTE THAT IN THE IMPUGNED ORDER PASSED BY THE ADJUDICATING AUTHORITY HE AS SPECIFICALLY MENTIONED THAT SUCH AN OPPORTUNITY WAS SOUGHT BY TH E ASSESSEE. HOWEVER, NO SUCH OPPORTUNITY WAS GRANTED AND THE AF ORESAID PLEA IS NOT EVEN DEALT WITH BY THE ADJUDICATING. AS FAR AS THE TRIBUNAL IS CONCERNED, WE FIND THAT REJECTION OF THIS PLEA IS TOTALLY UNTE NABLE. THE TRIBUNAL HAS SIMPLY STATED THAT CROSS-EXAMINATION OF THE SAID DE ALERS COULD NOT HAVE BROUGHT OUT ANY MATERIAL WHICH COULD NOT BE IN POSS ESSION OF THE APPELLANT THEMSELVES TO EXPLAIN AS TO WHY THEIR EX- FACTORY PRICES REMAIN STATIC. IT WAS NO FOR THE TRIBUNAL TO HAVE GUESS WO RK AS TO FOR WHAT PURPOSES THE APPELLANT WANTED TO CROSS-EXAMINE THOS E DEALER 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 ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 8 EXAMINATION. THAT APART, THE ADJUDICATING AUTHORITY SIMPLY RELIED UPON THE PRICE LIST AS MAINTAINED AT THE DEPOT TO DETERM INE THE PRICE FOR THE PURPOSE OF LEVY OF EXCISE DUTY. WHETHER THE GOODS W ERE, IN FACT, SOLD TO THE SAID DEALERS/WITNESSES AT THE PRICE WHICH IS ME NTIONED IN THE PRICE LIST ITSELF COULD BE THE SUBJECT MATTER OF CROSS-EX AMINATION. THEREFORE, IT WAS NOT FOR THE ADJUDICATING AUTHORITY TO PRESUPPOS E AS TO WHAT COULD BE THE SUBJECT MATTER OF THE CROSS-EXAMINATION AND MAD E THE REMARKS AS MENTIONED ABOVE. WE MAY ALSO POINT OUT THAT ON AN E ARLIER OCCASION WHEN THE MATTER CAME BEFORE THIS COURT IN CIVIL APP EAL NO. 2216 OF 2000, ORDER DATED 17.2.2005 WAS PASSED REMITTING TH E CASE BACK THE TRIBUNAL WITH THE DIRECTIONS TO DECIDE THE APPEAL O N MERITS GIVING ITS REASONS FOR ACCEPTING OR REJECTING THE SUBMISSIONS. 8. IN VIEW THE ABOVE, WE ARE OF THE OPINION THAT IF THE 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 THE AFORESAID TWO WITNESSES WAS THE ONLY BASIS OF ISSUI NG THE SHOW CAUSE NOTICE.' 7. IN LIGHT OF AFORESAID DISCUSSIONS, THE STATEMENT OF A THIRD PARTY CANNOT BE SOLE BASIS OF THE ASSESSMENT WITHOUT GIVEN AN OPPOR TUNITY OF CROSS EXAMINATION AND CONSEQUENTLY IT IS A SERIOUS FLAW WHICH RENDERS THE ORDER A NULLITY. IN LIGHT OF THE SAME, WE DONT DEEM NECESSARY TO EXAMINE OTH ER CONTENTIONS RAISED BY THE LD AR. THE ORDER SO PASSED BY THE AO IS HEREBY SET-ASIDE. THE APPEAL OF THE ASSESSEE IS THUS ALLOWED. 8. IN ITA NO. 496/JP/2019, BOTH THE PARTIES FAIRLY SUBMITTED THAT THE FACTS AND CIRCUMSTANCES OF THE CASE ARE IDENTICAL AND SIM ILAR CONTENTIONS MAY BE CONSIDERED. AS SUBMITTED BY THE BOTH THE PARTIES, S INCE FACTS AND CIRCUMSTANCES ITA NOS. 495 & 496/JP/2019 SHRI VISHNU KUMAR GUPTA, JAIPUR VS. DCIT, CIRCLE-06 , JAIPUR 9 OF THE CASE ARE EXACTLY IDENTICAL TO FACTS AND CIRC UMSTANCES OF THE CASE IN ITA NO. 495/JP/2019, OUR FINDINGS AND DIRECTIONS CONTAI NED THEREIN SHALL APPLY MUTATIS MUTANDIS TO THIS APPEAL. IN THE RESULT, THE MATTER IS DECI DED IN FAVOUR OF THE ASSESSEE. IN THE RESULT, APPEALS OF BOTH THE ASSESSEE ARE DIS POSED OFF IN LIGHT OF ABOVE DIRECTIONS. ORDER PRONOUNCED IN THE OPEN COURT ON 20/01/2021. SD/- SD/- LANHI XKSLKBZ FOE FLAG ;KNO ( SANDEEP GOSAIN ) (VIKRAM SINGH YADAV) U;KF;D LNL;@ JUDICIAL MEMBER YS[KK LNL;@ ACCOUNTANT MEMBER TK;IQJ@ JAIPUR FNUKAD@ DATED:- 20/01/2021 * GANESH KR. VKNS'K DH IZFRFYFI VXZSFKR@ COPY OF THE ORDER FORWARDED TO: 1. VIHYKFKHZ@ THE APPELLANT- SMT. SANTOSH GUPTA, JAIPUR SH. VISHNU KUMAR GUPTA, JAIPUR 2. IZR;FKHZ@ THE RESPONDENT- DCIT, CIRCLE-06, JAIPUR 3. VK;DJ VK;QDR@ CIT 4. VK;DJ VK;QDR@ CIT(A) 5. FOHKKXH; IZFRFUF/K] VK;DJ VIHYH; VF/KDJ.K] T;IQJ@ DR, ITAT, JAIPUR. 6. XKMZ QKBZY@ GUARD FILE {ITA NO. 495 & 496/JP/2019} VKNS'KKUQLKJ@ BY ORDER, LGK;D IATHDKJ@ ASST. REGISTRAR