DCIT Circle 9 (1), V. Suncity Projects Ltd,

ITA 4997/DEL/2007

• Counselvise Citation: [2017] 130 COUNSELVISE.COM (IT) 7158 (ITAT-DELHI)
• Duration Of Justice: 9 year(s) 16 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 06-01-2017
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: G
• Next Hearing Date: 30-11-2016
• Assessment Year: 2003-2004
• Appeal Filed On: 20-12-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Department Lawyers: S K JAIN
• Assessee Lawyers: VED JAIN ADV SH A K AGGARWAL; ASHISH CHAD
• Keywords: Reopening of assessment; Unexplained cash credit; Reassessment proceedings
• Section: 68; 148; 54

Judgement Text

1 N THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G, NEW DELHI BEFORE SHRI H.S. SIDHU, JUDICIAL MEMBER AND SHRI O.P. KANT, ACCOUNTANT MEMBER I.T.A. NOS. 4996 & 4997 /DEL/200 7 A.YRS. : 2002-03 & 2003-04 DCIT, CIRCLE-9(1), ROOM NO. 163, C.R. BUILDING, NEW DELHI - 110 002 VS. M/S SUNCITY PROJECTS LTD. 49, 1 ST FLOOR, CONNAUGHT PLACE, NEW DELHI 110 001 (PAN: AABCS8906K) (APPELLANT) (RESPONDENT) CROSS OBJECTION NOS. 180 & 181/DEL/2008 A.YRS. : 2002-03 & 2003-04 M/S SUNCITY PROJECTS LTD. N-49, 1 ST FLOOR, CONNAUGHT PLACE, NEW DELHI 110 001 (PAN: AABCS8906K) VS. DCIT, CIRCLE-9(1), ROOM NO. 163, C.R. BUILDING, NEW DELHI - 110 002 (APPELLANT) (RESPONDENT) DEPARTMENT BY : SH. S.K. JAIN, SR. DR ASSESSEE BY : SH. VED JAIN, ADV., SH. A.K. AGGARWAL, CA & SH. ASHISH CHADHA, CA ORDER PER H.S. SIDHU : JM REVENUE HAS FILED THESE TWO APPEALS WHICH EMANAT E FROM THE COMMON ORDER DATED 29.10.2007 FOR A.Y. 2002-03 AND A.Y. 2003-04 OF THE LD. CIT(A). THE ASSESSEE HAS FILED TWO CROSS OBJECTIONS AGAINST THE ORDER OF THE LD. CIT(A) REJECTING ITS CONTENTION ON THE ISSUE OF REOPENING OF THE ASSESSMENT. SINCE THE ISSUES INVOLVED ARE C OMMON AND IDENTICAL, 2 HENCE, BOTH THE APPEALS AND THE CROSS OBJECTIONS WE RE HEARD TOGETHER AND ARE BEING DISPOSED OF BY THIS COMMON ORDER, BY DEALING WITH ASSESSMENT YEAR 2002-03. 2. THE REVENUE IN ITA NO. 4996/DEL/2007 (AY 2002-03 ) HAS RAISED THE FOLLOWING GROUNDS:- (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.9,73,50,000/- FOR A.Y. 2002-03 U/S 68 OF THE INC OME TAX ACT 1961. 3. THE REVENUE IN ITA NO. 4997/DEL/2007 (AY 2003-04 ) HAS RAISED THE FOLLOWING GROUNDS:- (I) ON THE FACTS AND IN THE CIRCUMSTANCES OF THE C ASE, LD. CIT(A) ERRED IN LAW AND ON FACTS IN DELETING THE ADDITION OF RS.2,24,50,000/- FOR A.Y. 2003-04 U/S 68 OF THE INC OME TAX ACT 1961. REVENUES APPEALS 4. THE BRIEF FACTS OF THE CASED ARE THAT THE ASSES SEE IS ENGAGED IN THE BUSINESS OF REAL ESTATE DEVELOPMENT AND FILED ITS R ETURN OF INCOME IN THE NORMAL COURSE. LATER ON, THE ASSESSMENTS WERE REOP ENED BY ISSUE OF NOTICE UNDER SECTION 148 OF THE I.T. ACT ON THE ALL EGATION THAT THE ASSESSEE COMPANY HAS RECEIVED ADVANCES AGAINST BOOK ING OF FLATS AND 3 PLOTS IN GURGAON AND DURING VERIFICATION BY THE DIT (INV), THESE ADVANCES WERE FOUND TO BE UNVERIFIABLE. 4.1 DURING THE COURSE OF THE REASSESSMENT PROCEEDIN GS, THE ASSESSEE WAS ASKED TO SUBMIT THE DETAILS WITH SUPPORTING EVI DENCES FOR SOURCE, IDENTITY AND CREDITWORTHINESS OF THE PARTIES FROM W HOM THE ASSESSEE HAS RECEIVED ADVANCES AGAINST BOOKING OF FLATS. NOT BE ING SATISFIED WITH THE REPLY, THE AO MADE ADDITION OF RS.9,73,50,000/- IN A.Y. 2002-03 AND RS.2,24,50,000/- IN A.Y. 2003-04 VIDE HIS ORDER DAT ED 27.12.2006 & 28.12.2006 RESPECTIVELY PASSED U/S. 143(3)/147 OF T HE I.T. ACT, 1961 AND COMPLETED THE REASSESSMENT AT RS. 9,61,50,180 AND R S. 2,69,30,553/- RESPECTIVELY. 4.2 AGGRIEVED BY THE ORDER OF THE AO, THE ASSESSEE PREFERRED AN APPEAL BEFORE THE LD. CIT(A) WHO VIDE HIS COMMON IMPUGNED ORDER DATED 29.10.2007 DELETED THE ADDITION HOLDING THAT THE AS SESSEE COMPANY IS IN THE BUSINESS OF REAL ESTATE DEVELOPMENT AND PROJECT MANAGEMENT RELATING TO REAL ESTATE PROJECTS AND THESE AMOUNTS HAVE BEEN RECEIVED IN THE FORM OF BOOKING ADVANCES FROM PROSPECTIVE CUSTOMERS. TH ESE AMOUNTS HAVE BEEN RECEIVED THROUGH BANK ACCOUNT OF THE CREDITORS THROUGH NORMAL BANKING CHANNEL. THE ASSESSEE HAS ALSO EXPLAINED T HE NATURE OF CREDIT AND THE SOURCE THEREOF AS BOOKING ADVANCES. THE AS SESSEE HAVING FILED THE CONFIRMATIONS, HAVING GIVEN THE NAME AND ADDRES S AND INDIVIDUAL ACCOUNT FOR EACH OF THE TRANSACTIONS INCLUDING PAN, ETC. LD. CIT(A) OBSERVED THAT THE AO WAS NOT JUSTIFIED IN DRAWING A DVERSE INFERENCE 4 WITHOUT BRINGING ANY FURTHER ADVERSE MATERIAL AND A CCORDINGLY VIDE HIS ORDER DATED 29.10.2007 HAS ALLOWED THE APPEAL OF TH E ASSESSEE. 5. AGGRIEVED WITH THE LD. CIT(A)S ORDER, THE REVEN UE IS IN APPEAL AND ASSESSEE HAS FILED CROSS OBJECTIONS ON THE ISSUE OF REOPENING OF ASSESSMENT FOR BOTH THE YEARS. 6. BOTH THESE REVENUES APPEALS CAME UP FOR HEARING BEFORE THE ITAT WAY BACK IN THE YEAR 2009 AND THE ITAT VIDE ITS ORD ER DATED 12.12.2009 DIRECTED THE LD. CIT(DR) TO FURNISH DETAILS FOR THE PURPOSE OF ASSISTING THE BENCH FOR APPRECIATING THE FACTS IN THE RIGHT PERSP ECTIVE. THEREAFTER VIDE LETTER DATED 25.01.2010 AN INTERIM REPLY RECEIVED F ROM THE AO WAS FILED FOR FURTHER VERIFICATION. THEREAFTER A LETTER DATE D 29.03.2012 FORWARDED BY THE AO TO LD. CIT(DR) WAS SUBMITTED. BY LETTER DA TED 02.05.2012 ANOTHER REPORT FORWARDED BY THE AO TO THE LD. CIT( DR) ON VERIFICATION OF PAN WAS SUBMITTED. THE ASSESSEE IN RESPONSE TO THE SE REPORTS FILED ITS REPLY EXPLAINING THE ERRORS POINTED OUT BY THE AO I N ITS REPORT. 7. LD. DR DURING THE HEARING HAS SUBMITTED THAT TH E AO HAD MADE THE ADDITION ON THE BASIS OF THE INFORMATION RECEIVED B Y IT FROM THE DIT (INV) AS THE ADVANCES RECEIVED BY IT WERE FOUND UNVERIFIA BLE. THOUGH THE ASSESSEE HAS SUBMITTED DETAILS, CONFIRMATION, ETC. OF THE ADVANCES RECEIVED BY IT FROM THE VARIOUS CUSTOMERS BEFORE TH E AO, THE AO, IN VIEW OF THE REPORT OF THE DIT-INV., WAS JUSTIFIED IN MAK ING THE ABOVE ADDITIONS. THE LD. CIT(A) HAS DELETED THE ADDITION HOLDING THA T IN THE ABSENCE OF ANY ENQUIRY OR ANY ADVERSE MATERIAL, ADDITIONS CANNOT B E MADE. LATER, THE 5 ITAT HAS GOT THE VERIFICATION DONE AND THE REPORT H AS BEEN RECEIVED FROM THE AO. IT WAS CONTENDED BY THE LD DR THAT IN THIS REPORT, IN SOME OF THE CASES, THE AO HAS POINTED OUT ERRORS AND DISCREPANC IES. IT WAS SUBMITTED BY THE LD. DR THAT TAKING INTO CONSIDERATION THE E RRORS/ DISCREPANCIES POINTED OUT BY THE AO, THE MATTER BE DECIDED ACCORD INGLY. 8. ON THE OTHER HAND, LD. COUNSEL OF THE ASSESSEE H AS SUBMITTED THAT DURING THE COURSE OF THE REASSESSMENT PROCEEDINGS, THE ASSESSEE HAS SUBMITTED EACH AND EVERY DETAIL IN SUPPORT OF ITS C ONTENTION. IN THE ASSESSMENT ORDER NO DISCREPANCIES OR ERRORS HAVE BE EN POINTED OUT BY THE AO IN THE DOCUMENTS SUBMITTED BY IT. THE LD. CIT(A ) AFTER GOING THROUGH EACH AND EVERY FACT AND EVIDENCES HAD DELETED THE A DDITIONS. WHEN THE MATTER CAME UP BEFORE ITAT, THE ITAT DIRECTED THE AO TO CARRY OUT THE VERIFICATION AND SUBMIT THE REPORT. THESE DIRECTION S WERE GIVEN WAY BACK IN THE YEAR 2009. THE AO AFTER MAKING ENQUIRIES HA S SUBMITTED ITS REPORT. MORE THAN 7 YEARS HAVE ELAPSED SINCE THEN AND NOTHI NG ADVERSE HAS COME OUT AGAINST THE ASSESSEE AS IS EVIDENT FROM THE REP ORT SUBMITTED BY THE AO SO AS TO JUSTIFY THE ADDITIONS. IN REGARD TO TH E ERRORS/ DISCREPANCIES POINTED OUT IN ITS REPORT IN PAN, IN SOME OF THE CA SES AND OTHER ISSUES, THE LD COUNSEL OF THE ASSESSEE SUBMITTED THAT EACH AND EVERY ERROR POINTED OUT BY AO HAVE BEEN CLARIFIED IN THE REPLY SUBMITTED BY IT ALONG WITH EVIDENCES. THE AO HAS SUBMITTED REPORT ON VER IFICATION OF PAN, ROC DATA AND STATUS AND MOVEMENT IN BANK ACCOUNT. AS S UCH IT IS A CASE WHERE AFTER DETAILED VERIFICATION NOTHING HAS COME OUT. IN THIS REGARD IT WAS SUBMITTED THAT THIS ASSESSMENT WAS REOPENED MER ELY FOR THE PURPOSE 6 OF VERIFICATION AS IS EVIDENT FROM THE REASONS RECO RDED WHEREIN IT HAS BEEN ALLEGED THAT THE ADVANCES RECEIVED BY THE ASSE SSEE FOR BOOKING OF FLATS REMAIN UNVERIFIABLE. EVEN IN THE REASONS REC ORDED FOR REOPENING THERE WAS NO ADVERSE MATERIAL AGAINST THE ASSESSEE. 9. WE HAVE HEARD THE RIVAL SUBMISSIONS AND PERUSED THE RECORDS, ESPECIALLY THE ORDERS OF THE REVENUE AUTHORITIES, R EPORT SUBMITTED BY THE AO AND THE REPLY THERETO AND ALSO THE OTHER MATERIA L PLACED ON RECORD. AFTER GOING THROUGH THE FACTS WE NOTE THAT IT IS A CASE WHERE ADDITIONS HAVE BEEN MADE ON THE ALLEGATION THAT ADVANCES RECE IVED BY THE ASSESSEE AGAINST BOOKING OF FLATS REMAIN UNVERIFIABLE. 9.1 THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINE SS OF REAL ESTATE DEVELOPMENT. DURING THE YEAR UNDER CONSIDERATION, THE ASSESSEE WAS DEVELOPING ITS PROJECT IN SECTOR 54, GURGAON. IT H AS INCURRED A TOTAL COST OF RS.101.89 CRORE ON THIS PROJECT DURING THE FINAN CIAL YEAR 2001-02 I.E. A.Y. 2002-03. AGAINST THIS, THE ASSESSEE COMPANY H AS RECEIVED ADVANCES FROM THE CUSTOMERS OF RS.78.20 CRORE. IN THE NEXT YEAR I.E. F.Y. 2002-03 (A.Y. 2003-04) IT INCURRED FURTHER EXPENDITURE OF R S.132.83 CRORE ON THIS PROJECT AND RECEIVED ADVANCES FROM CUSTOMERS AGAINS T BOOKING OF FLATS OF RS.123.84 CRORE. THE AO HAS RAISED DOUBT ABOUT THE SE ADVANCES TO THE EXTENT OF RS.9.73 CRORE ONLY OUT OF TOTAL ADVANCES RECEIVED OF RS.78.20 CRORES IN THE A.Y. 2002-03 AND RS.2.24 CRORE ONLY O UT OF TOTAL ADVANCES RECEIVED OF RS.123.83 CRORES IN THE A.Y. 2003-04. 7 9.2 DURING THE REASSESSMENT PROCEEDINGS THE AO CALL ED UPON THE ASSESSEE TO SUBSTANTIATE THESE ADVANCES. THE ASSES SEE COMPANY SUBMITTED THE DOCUMENTS/ EVIDENCES FOR EACH OF THES E ADVANCES WHICH INCLUDED CONFIRMATIONS, BANK STATEMENT, COPY OF ITR , COPY OF APPLICATION FORM FOR ALLOTMENT OF RESIDENTIAL UNIT, ALLOTMENT L ETTER ISSUED BY THE ASSESSEE COMPANY, CONFIRMATION OF ACCOUNT, ETC. T HE AO THEREAFTER DID NOT CARRY ANY FURTHER ENQUIRY OR VERIFICATION. THE AO ON THE BASIS OF THE REPORT RECEIVED BY HIM FROM THE DIRECTOR (INV) ADDE D THIS AMOUNT AS UNEXPLAINED CREDIT IN THE HANDS OF THE ASSESSEE. TH E LEARNED CIT(A) HAS DELETED THE ADDITIONS HOLDING THAT (I) IT IS PRELIMINARY DUTY OF THE ASSESSEE TO EXPLA IN AND ESTABLISH THE NATURE OF SUM DEBITED IN HIS BOOKS OF ACCOUNT A ND THE SOURCE THEREOF; (II) ONCE THE NATURE AND SOURCE HAS BEEN EXPLAINED, IT IS THE DUTY OF THE AO TO DISAPPROVE THE EXPLANATION OF THE ASSE SSEE ABOUT THE NATURE AND SOURCE; (III) BEFORE REJECTING ASSESSEES EXPLANATION THE A O MUST MAKE ENQUIRIES AND IN THE ABSENCE OF PROPER ENQUIRIES TH E ADDITION CANNOT BE SUSTAINED; (IV) IN THE PRESENT CASE APPELLANT COMPANY BEING IN THE REAL ESTATE DEVELOPMENT HAS RECEIVED THE AMOUNTS IN THE FORM OF BOOKING ADVANCES FROM THE PROSPECTIVE BUYERS, THESE ADVANCE S HAVE BEEN RECEIVED BY ACCOUNT PAYEE CHEQUES, THE AMOUNTS SO 8 RECEIVED BY THE APPELLANT COMPANY HAVE BEEN CLEARED FROM THE BANK ACCOUNT OF THE CREDITORS THROUGH THE NORMA L BANKING CHANNEL. (V) THE ASSESSEE COMPANY HAS FILED CONFIRMATION FRO M THE PARTIES ABOUT THE TRANSACTIONS GIVING NAMES AND ADDRESSES O F THE PARTIES AND INDIVIDUAL AMOUNT IN EACH TRANSACTION I NCLUDING PAN DURING THE ASSESSMENT PROCEEDINGS FOR CONSIDERA TION AND VERIFICATION BY THE AO ABOUT THE REAL EXISTENCE OF THE PARTIES, THEIR CAPACITY TO ADVANCE SUCH AMOUNT AND THE GENUI NENESS OF THE TRANSACTION. (VI) THE ASSESSING OFFICER THEREAFTER DID NOT CARRY OUT ANY VERIFICATION AND NOT BRING ADVERSE MATERIAL TO DISC REDIT/ REBUT THE EVIDENCES SUBMITTED BY THE ASSESSEE. (VII) THE ASSESSEE THUS HAS DULY EXPLAINED THE NATU RE AND SOURCE THEREOF WITH RELEVANT SUPPORTING DOCUMENTARY EVIDEN CES/ DETAILS AND AS SUCH FULFILLED AND DISCHARGED ITS ON US THAT LAY ON IT IN TERMS OF SECTION 68 OF THE ACT. 9.3 WHEN THE MATTER TRAVELLED TO THE ITAT, THE ITAT DIRECTED THE CIT(DR) TO CARRY OUT THE VERIFICATION AND IN THIS R EGARD PASSED A DETAILED INTERIM ORDER AS UNDER:- 9 THE LEARNED CIT (DR) IS DIRECTED TO FURNISH US THE FOLLOWING DETAILS FOR THE PURPOSE OF ASSISTING US IN LAYING D OWN THE FACTS IN ITS RIGHT PERSPECTIVE. 1) THE ASSESSEE HAS PROVIDED THE PAN OF THE PERSONS WHO HAVE GIVEN THE ADVANCES FOR PURCHASE OF PLOTS AT GURGAON SECTOR 54 PROJECTS. THE PAN IS TO BE VERIF IED WITH THE NAMES & ADDRESSES GIVEN. 2) THE LATEST INCOME TAX RETURN COPIES ALONGWITH TH E BALANCE SHEETS AND SCHEDULES THERE TO IN RESPECT OF ALL THE PERSONS WHOSE PAN HAVE BEEN GIVEN ARE TO BE PRODUCED. THE INCOME TAX RETURN COPIES FILED BY AL L THE SAID PAN HOLDERS FOR THE ASSESSMENT YEAR 2002-03 & 2003-04 ALONGWITH BALANCE SHEET AND SCHEDULE THERET O ARE TO BE PRODUCED. THE INCOME TAX RETURNS OF ALL THE SAID PAN HOLDERS FOR THE ASSESSMENT YEAR 2005-06 & 2006-07 ARE ALSO TO BE PRODUCED. IN THE EVENT THAT INCOME TAX RETURNS ARE NOT AVAILABLE, COPIES OF THE RETURNS FILED FOR THOSE YEARS CALLED FOR MAY BE OBT AINED FROM THE REGISTRAR OF COMPANIES AS ARE AVAILABLE WI TH THE REGISTRAR OF COMPANIES. 3) IT IS NOTICED THAT THE ASSESSEE HAS RETURNED ADV ANCES THROUGH ITS ACCOUNTS IN HDFC BANK LTD. AND HAS BEEN GIVEN IN THE CHART PROVIDED IN BRIEF IS ENCLOSED AS 10 ANNEXURE A-I. THE RETURN OF THE DEPOSITS IS TO BE VERIFIED IN CONNECTION WITH THE CHEQUE NUMBER WHICH HAVE ALSO BEEN PROVIDED AND YOU ARE DIRECTED TO INF ORM US AS TO WHICH ACCOUNTS. THE NAMES OF ACCOUNTS HOLDERS AND THE BANK ACCOUNT AND PROVIDE COPIES OF THE BANK ACCOUNTS FOR THE PERIOD DURING WHICH THE CHEQU ES HAVE BEEN ENCASHED AND THE STATEMENT OF THE FUNDS THERE FROM. THESE DETAILS ARE TO BE PRODUCED BEFOR E US BEFORE THE NEXT DATE OF HEARING. COPIES OF ALL THE DETAILS ARE ALSO TO BE GIVEN TO T HE ASSESSEE IMMEDIATELY ON BEING. THE DETAILS ARE ALSO TO BE GIVEN BY 1 ST FEB. 2010 AND THE CASE IS ADJOURNED TO 15.2.2010. 9.4 PURSUANT TO THE DIRECTIONS OF THE ITAT, THE AO HAS CARRIED OUT THE VERIFICATION AND HAS SUBMITTED HIS REPORT ON THE VE RIFICATION OF PAN, AVAILABILITY OF THE DATA/ STATUS WITH THE REGISTRAR OF COMPANIES AS WELL AS ON VERIFICATION FROM THE RESPECTIVE BANK ACCOUNT OF EACH OF THESE CREDITORS. ON GOING THROUGH THESE REPORTS, WE NOTE THAT EXCEPT POINTING OUT SOME ERRORS IN THE PAN, SOME COMPANIES INACTIVE WITH ROC AND AO NOT BEING ABLE TO OBTAIN DETAILS IN SOME CASES FROM THE RESPECTIVE BANK, NOTHING ADVERSE HAS BEEN BROUGHT ON RECORD AGAINST THE ASSESSEE. IN THE REPORT DATED 29.03.2012, THE AO HAS CONFIRMED THAT PAN OF THE PARTIES HAVE BEEN VERIFIED EXCEPT IN SOME OF THE CASES. OU T OF 37 CASES, THE AO 11 HAS POINTED OUT ERRORS IN RESPECT OF 9 CASES MEANIN G THEREBY THAT PAN STAND VERIFIED IN REST OF THE 28 CASES. THE ASSESS EE IN ITS REPLY HAS CLARIFIED EACH OF THE ERROR POINTED OUT BY THE AO I N THESE 9 CASES. THE ASSESSEE IN SUPPORT OF IT CLARIFICATION HAS SUBMITT ED EVIDENCES IN THE FORM OF ASSESSMENT ORDER, COPY OF PAN AND THE PAYMENT OF CHALLAN, ETC. ON GOING THROUGH THIS REPORT OF AO AND THE REPLY OF TH E ASSESSEE, WE NOTE THAT ERROR HAS OCCURRED IN BECAUSE IN SOME OF THE C ASES THE NAME OF THE COMPANY HAS BEEN CHANGED AND THAT IS WHY THE AO HAS POINTED OUT ERROR. AFTER SUBMISSION OF THE CLARIFICATION WITH EVIDENCE S BY THE ASSESSEE, NO FURTHER ERRORS HAVE BEEN POINTED OUT BY THE AO. TH E LD. DR DURING THE COURSE OF HEARING ALSO COULD NOT REBUT THE REPLY OF THE ASSESSEE. 9.5 WE ALSO NOTE THAT ON THE ISSUE OF VERIFICATION FROM THE REGISTRAR OF COMPANIES, THE AO HAS ALSO SUBMITTED REPORT WHEREBY HE HAS POINTED OUT THAT SOME OF THE COMPANIES ARE DORMANT AND SOME OF THE COMPANIES NAMES HAVE BEEN STRUCK OFF. THE ASSESSEE HAS FILED REPLY TO THIS REPORT OF THE AO. IT HAS BEEN CLARIFIED BY THE ASSESSEE THAT THESE COMPANIES WERE ACTIVE AT THE RELEVANT POINT OF TIME AND EVIDENCES IN SUPPORT THEREOF WERE ALSO FILED. LATER ON, AFTER 7 OR 8 YEARS SINCE THE SE COMPANIES HAVE BECOME DORMANT OR INACTIVE AND THE SAME CANNOT BE A GROUND TO DRAW ANY ADVERSE INFERENCE. 9.6 WE FURTHER FIND THAT THE AO HAS ALSO CARRIED OU T VERIFICATION FROM THE BANKERS OF THE CREDITORS AND A DETAILED REPORT HAS BEEN SUBMITTED ON THIS ASPECT ALSO. ON GOING THROUGH THIS REPORT WE NOTE THAT IN MANY CASES 12 THE AO HAS GOT THE AMOUNT VERIFIED. IN MANY CASES AO HAS NOT GOT DETAILS FROM THE BANK. THE FACT REMAINS THAT NOTHI NG HAS COME OUT SO AS TO DRAW ADVERSE INFERENCE AGAINST THE ASSESSEE IN T HE VERIFICATION CARRIED OUT BY THE AO. ON THE CONTRARY THIS REPORT CONFIRM S THAT EXISTENCE OF SUCH CREDITORS AND THEIR BANK ACCOUNT. 9.7 WE ALSO NOTE THAT VIDE ANOTHER REPORT DATED 02. 05.2012, THE AO HAS CONFIRMED THAT IT HAS OBTAINED INCOME TAX RETURNS F ROM THE RESPECTIVE AOS OF THESE CREDITORS. IN THIS REPORT ALSO NOTHING AD VERSE HAS BEEN POINTED OUT. 9.8 KEEPING IN VIEW OF THE FACTS AND CIRCUMSTANCES OF THE CASE, WE ARE OF THE VIEW THAT IN THE PRESENT CASE NOT ONLY THE A SSESSEE HAS LED SUFFICIENT EVIDENCES IN SUPPORT OF ITS CONTENTION B UT ALSO IN THE DETAILED VERIFICATION CARRIED OUT BY THE AO NOTHING HAS COME OUT SO AS TO DRAW ADVERSE INFERENCE AGAINST THE ASSESSEE. THE ASSESS EE HAS RECEIVED ADVANCES FOR BOOKING OF FLATS IN RESPECT OF THE PRO JECT BEING DEVELOPED BY IT IN GURGAON. THE ASSESSEE HAS RECEIVED NOT ONLY THESE ADVANCES FOR BOOKING OF FLATS BUT ALSO FROM OTHER CUSTOMERS AS I S EVIDENT FROM THE FIGURES STATED HEREINABOVE. THE ASSESSEE HAVING DU LY ACCOUNTED FOR THESE ADVANCES AND HAVING SUBMITTED THE NECESSARY E VIDENCES IN SUPPORT THEREOF, WE ARE ALSO OF THE VIEW THAT THE AO WAS NO T JUSTIFIED IN MAKING THESE ADDITIONS IN THE HANDS OF THE ASSESSEE. IT I S A CASE WHERE THE ASSESSEE HAS LED SUFFICIENT EVIDENCES IN SUPPORT OF ITS CONTENTION AND ACCORDINGLY WE ARE OF THE CONSIDERED VIEW THAT LD. CIT(A) HAS PASSED A 13 WELL REASONED ORDER WHICH DOES NOT NEED ANY INTERFE RENCE ON OUR PART, HENCE, WE UPHOLD THE ORDER OF THE LD. CIT(A) AND AS A RESULT THEREOF, THE APPEALS FILED BY THE REVENUE STAND DISMISSED. ASSESSEES CROSS OBJECTIONS:- 10. THE GROUNDS RAISED IN THE CROSS OBJECTION NO. 1 80/DEL/2008 (AY 2002-03) READ AS UNDER:- 1. THE LD. CIT(A), NEW DELHI HAS GROSSLY ERRED B OTH IN FACTS AND IN LAW IN CONFIRMING THE ACTION OF AO IN REOPENING THE ASSESSMENT U/S. 148 OF THE INCOME TAX ACT, 1961 AS HE HAS DISMISSED THE GROUND BY REFERR ING IN THE ORDER THAT IN HIS VIEW THE CHALLENGE TO REOP ENING THE ASSESSMENT WAS A GENERAL ALLEGATION AGAINST THE ASSESSMENT ORDER PASSED AND PROCEEDINGS INITIATED U /S. 147/148 AND HE WAS DISPOSED OF THE GROUND OF REOPENING OF THE ASSESSMENT BY STATING THAT I AM OF THE VIEW THAT NO SEPARATE ADJUDICATION IS NECESSARY. 2. THE RESPONDENT CRAVES LEAVE TO ADD, TO AMEND, AL TER, VARY OR SUBSTITUTE THE ABOVE GROUNDS OF CROSS OBJEC TION OR ADD A NEW GROUND OR GROUNDS AT ANY TIME BEFORE O R AT THE TIME OF HEARING OF THE CROSS OBJECTION AS TH EY MAY BE ADVISED. 14 11. THE GROUNDS RAISED IN THE CROSS OBJECTION NO. 1 81/DEL/2008 (AY 2003-04) READ AS UNDER:- 1. THE LD. CIT(A), NEW DELHI HAS GROSSLY ERRED B OTH IN FACTS AND IN LAW IN CONFIRMING THE ACTION OF AO IN REOPENING THE ASSESSMENT U/S. 148 OF THE INCOME TAX ACT, 1961 AS HE HAS DISMISSED THE GROUND BY REFERR ING IN THE ORDER THAT IN HIS VIEW THE CHALLENGE TO REOP ENING THE ASSESSMENT WAS A GENERAL ALLEGATION AGAINST THE ASSESSMENT ORDER PASSED AND PROCEEDINGS INITIATED U /S. 147/148 AND HE WAS DISPOSED OF THE GROUND OF REOPENING OF THE ASSESSMENT BY STATING THAT I AM OF THE VIEW THAT NO SEPARATE ADJUDICATION IS NECESSARY. 2. THE RESPONDENT CRAVES LEAVE TO ADD, TO AMEND, AL TER, VARY OR SUBSTITUTE THE ABOVE GROUNDS OF CROSS OBJEC TION OR ADD A NEW GROUND OR GROUNDS AT ANY TIME BEFORE O R AT THE TIME OF HEARING OF THE CROSS OBJECTION AS TH EY MAY BE ADVISED. 12. SINCE WE HAVE ALREADY UPHELD THE ORDER OF THE L EARNED CIT(A) DELETING THE ADDITIONS ON MERIT IN THE REVENUES AP PEAL, AS AFORESAID, THE CROSS OBJECTIONS FILED BY THE ASSESSEE CHALLENGING THE REOPENING OF THE ASSESSMENT HAS BECOME ACADEMIC IN NATURE AND THEREF ORE, THE SAME ARE DISMISSED AS INFRUCTUOUS. AS A RESULT, BOTH THE CRO SS OBJECTIONS FILED BY THE ASSESSEE STAND DISMISSED. 15 13. IN THE RESULT, BOTH THE REVENUES APPEALS AND A SSESSEES CROSS OBJECTIONS STAND DISMISSED. ORDER PRONOUNCED IN THE OPEN COURT ON 06-01-2017. SD/- SD/- [O.P. KANT] [H.S. SIDHU] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE 06/01/2017 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