The DCIT, Central Circle-1(1), Ahmedabad V. Core Health Care Ld., Ahmedabad

ITA 85/AHD/2007

• Counselvise Citation: [2009] 115 COUNSELVISE.COM (IT) 0312 (ITAT-AHMEDABAD)
• Duration Of Justice: 2 year(s) 9 month(s) 10 day(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2009
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: B
• Next Hearing Date: 07-10-2009
• Assessment Year: 1996-1997
• Appeal Filed On: 05-01-2007
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Assessee Lawyers: S N SOPARKAR
• Keywords: Tax effect
• Section: 260A; 274; 251

Judgement Text

1 IN THE INCOME TAX APPELLATE TRIBUNAL, B-BENCH, AHMEDABAD. BEFORE: SHRI T K SHARMA, JUDICIAL MEMBER , AND SHRI D.C.AGRAWAL, ACCOUNTANT MEMBER. ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998) D.C.I.T., CENTRAL CIRCLE 1(1), AHMEDABAD. VERSUS CORE HEALTH CENTRE LIMITED, CORE TOWER, NR. PARIMAL CROSSING, AHMEDABAD. (APPELLANT) (RESPONDENT) PAN: AAACC 6252 H FOR THE APPELLANT: SHRI ANIL KUMAR, CIT DR FOR THE RESPONDENT SHRI S.N. SOPARKAR AND HIMANSHU SHAH, AR ORDER PER BENCH: ASSESSMENT YEAR 1996-1997 AND 1997-1998 THESE ARE THE 2 APPEALS FILED BY THE REVENUE AGAINS T THE ORDER OF LEARNED. LD. COMMISSIONER OF INCOME TAX(APPEALS) DATED 10-10 -2006. 2. THE COMMON ISSUE INVOLVED IN THIS APPEALS ARE TH AT LD. COMMISSIONER OF INCOME TAX(APPEALS) HAS DELETED THE ADDITION OF RS. 18.45 CRORES MADE BY THE ASSESSING OFFICER IN THE A .Y. 1996-97 ON THE GROUND THAT ASSESSEE HAS ADVANCED INTEREST BEARING FUNDS TO SISTER CONCERNS. FACTS OF THE CASE ARE THAT DURING THE C OURSE OF ASSESSMENT PROCEEDINGS, FOR THE ASSESSMENT YEAR 1996-97 & 199 7-98 ASSESSING OFFICER FOUND THAT THE ASSESSEE HAS ADVANCED RS. 10 2.5 CRORES TO SISTER CONCERNS FREE OF INTEREST. IT IS NOTED BY HIM THAT THESE SISTER CONCERNS ARE SUBSIDIARIES OF THE ASSESSEE COMPANY AND TRANSACTIO NS HAD TAKEN PLACE WITH THEM DURING THE FINANCIAL YEARS 1995-1996. TH E ASSESSEE HAD TAKEN 2 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 LOAN FROM THE FINANCIAL INSTITUTIONS AND ADVANCES W ERE GIVEN TO THE SISTER CONCERNS AS UNDER: A. PAID FOR ACQUISITION OF INTERNATIONAL BUSINESS | (EXPORT BUSINESS) ON GOING CONCERN BASIS WITH ALL RIGHTS OF EXISTING EXPORT ORDERS, REGISTRATION OF PRODUCTS IN VARIOUS COUNTRIES, DISTRIBUTION SET UP IN ALL MAJOR COUNTRIES, ADVANCE S FROM CUSTOMERS AND EXPORT RECEIVABLES, TRAINED AND EXPER IENCED STAFF, ETC. THE AMOUNT PAID FOR BUSINESS ACQUISITIO N WAS BASED ON VALUATION MADE BY ICICI LTD AND AS APPROVE D BY BOARD OF DIRECTORS OF THE COMPANY. 40.00 B. AMOUNT PAID FOR ADVANCES TOWARDS CONTRIBUTION FO R CAPITAL COST OF PROJECT FOR MANUFACTURE OF NEEDLES FOR I.V. SETS AND SYRINGES. THE COMPANY WAS IMPORTING NEEDLES AND AS BACKWARD INTEGRATION POLICY, A SEPARATE COMPANY WAS SET UP TO MANUFACTURE NEEDLES REQUIRED IN LARGE QUANTIT Y FOR THE I.V. SETS AND SYRINGES MANUFACTURED BY THE COMP ANY . THE COMPANY BEING ONE OF THE PROMOTERS OF THE PROJE CT CONTRIBUTED RS. 10.00 CRORES TO A COMPANY WHICH WAS TO PUT UP HITS PROJECT. 10.00 C. AMOUNT PAID FOR ESTABLISHING AN ALL INDIA DISTRI BUTION NETWORK AND INFRASTRUCTURE INCLUDING HIRING OF DEPOT/WAREHOUSES, SET UP OF OFFICE FACILITIES AT EA CH DEPOT, RECRUITMENT OF MARKETING PERSONNEL AND OTHER EQUIPM ENTS LIKE COMPUTER, ETC. AT SUCH SET UP. THE AMOUNT WAS GIVEN TO A COMPANY WITH WHOM THE COMPANY HAD UNDERSTANDIN G FOR SETTING UP SUCH ALL INDIA DISTRIBUTION NETWORK FOR WAREHOUSING AND SALE OF COMPANYS PRODUCTS. 10.00 D. AMOUNT PAID TO A COMPANY FOR ACQUISITION OF OFFI CE 40.00 3 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 BUILDINGS FOR THE COMPANY AND A LARGE PROPERTY TO B E DEVELOPED FOR THE COMPANY AND A LARGE PROPERTY TO B E DEVELOPED FOR THE COMPANYS OWN USE OR FOR DEVELOPM ENT AS COMMERCIAL PROPERTY. THE COMPANY TO WHOM SUCH AMOUNT WAS ADVANCED SPENT MAJOR PORTION OF AMOUNT ADVANCED FOR ACQUISITION OF ASSETS ALMOST ENTIRE PO RTION OF WHICH WAS ENJOYED BY THE COMPANY FOR IT BUSINESS PURPOSES INCLUDING HOUSING OFFICES/STAFF, CAR PARKI NG TRAINING CENTERS ETC. WITHOUT ANY COST/ E. AMOUNT ADVANCED TO A RESEARCH FOUNDATION HAVING OBJECT TO CARRY OUT RESEARCH RELATED TO COLLECTION OF BLOO D, BLOOD TRANSFUSION AND OTHER RELATED AREAS. UAS THE COMPA NY WAS IN THE BUSINESS OF MANUFACTURE OF BLOOD COLLECTION BAGS AS FOR DEVELOPMENT OF NEW PRODUCTS. 2.50 TOTAL---------------------------------------------- --------------------RS.102.50 CR. 3. IT WAS EXPLAINED TO THE ASSESSING OFFICER THAT A DVANCES WERE GIVEN FOR BUSINESS PURPOSES AND ASSESSEE IS BENEFITED BY WAY OF ACQUISITION OF INTERNATIONAL BUSINESS OF EXPORTS, DEVELOPMENT OF A LL INDIA DISTRIBUTION SYSTEM ETC. IT WAS ALSO EXPLAINED THAT ASSESSEE CO MPANY HAD SHARE HOLDER FUNDS TO THE EXTENT OF RS. 413.77 CRORES WHICH COMP RISED OF SHARE CAPITAL AND RESERVES AND THEREFORE NO INTEREST COULD BE DIS ALLOWED. THE ASSESSING OFFICER WAS NOT SATISFIED AND HAD WORKED OUT DISALLOWABLE PORTION OF INTEREST AT RS. 18.5 CRORES FOR BOTH YEA RS EACH BEING THE INTEREST PAYABLE BY THE ASSESSEE ON A SUM OF RS. 102.50 CROR ES AT THE RATE AT WHICH IT HAD BORROWED FUNDS. 4. THE LD. COMMISSIONER OF INCOME TAX(APPEALS) ALLO WED THE CLAIM OF THE ASSESSEE FOLLOWING THE DECISION OF ITAT, AHM EDABAD BENCH IN THE CASE OF TORRENT FINANCERS V/S. CIT (2001) 73 TTJ, 6 24. HE FURTHER HELD 4 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 THAT ASSESSING OFFICER HAS NOT ESTABLISHED NEXUS BE TWEEN THE INTEREST FREE ADVANCES AND INTEREST BEARING FUNDS AND HAS ALSO NO T COUNTERED THE ARGUMENTS OF THE ASSESSEE THAT BORROWED FUNDS WERE UTILIZED FOR ACQUISITION OF ASSETS AND FOR WORK IN PROGRESS AND FURTHER THAT IT HAD SUFFICIENT INTEREST FREE CAPITAL AND ITS OWN SHARE HOLDER FUNDS AND CAPITAL RESERVE. 5. BEFORE US THE LEARNED DR RELIED ON THE DECISION OF HON'BLE PUNJAB HIGH AND HARYANA HIGH COURT IN ABHISHEK INDUSTRIES (2006) 286 ITR 001 FOR THE PROPOSITION THAT WHERE LOANS ARE ADVANC ED INTEREST FREE TO SISTER CONCERNS, ONUS IS ON ASSESSEE TO SHOW THAT B ORROWINGS WERE USED FOR BUSINESS PURPOSE. IN ADDITION TO THIS, HE RELI ED ON THE ORDER OF THE ASSESSING OFFICER. 6. AGAINST THIS, THE LEARNED AR FOR THE ASSESSEE RA ISED PRELIMINARY ISSUE THAT REVENUE EFFECT IN THIS CASE IS NIL AS AS SESSED INCOME AND RETURNED INCOME, BOTH ARE LOSS AND THEREFORE FOLLOW ING THE DECISION OF HON'BLE DELHI HIGH COURT IN CIT VS. MANGLAM RICINUS LIMITED (2008) 174 TAXMAN 186 DELHI APPEAL IS NOT MAINTAINABLE. I N THE ALTERNATIVE, LEARNED A.R. SUBMITTED THAT ISSUE IS COVERED BY THE DECISIONS OF THIS TRIBUNAL IN THE CASE OF ITO VS. YASHVANT S. TEJANI ITA 268/A/05 FOR THE ASSESSMENT YEAR 2001-02 PRONOUNCED ON 04-09-2009, W HEREIN IT IS HELD THAT IF ASSESSEE HAS DISCHARGED THE PRIMARY ONUS BY SHOWING THAT IT HAS SUFFICIENT INTEREST FREE CAPITAL, THEN IT IS FOR TH E REVENUE TO SHOW THAT IN SPITE OF ASSESSEE HAVING INTEREST FREE CAPITAL THE INTEREST FREE ADVANCES WERE MADE OUT OF INTEREST BEARING FUNDS. 7. WE HAVE CONSIDERED THE RIVAL SUBMISSIONS AND PER USING THE MATERIAL ON RECORD. IN OUR CONSIDERED VIEW, THE CA SE IS PRIMARILY COVERED 5 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 BY THE DECISION OF HON'BLE DELHI HIGH COURT IN MANG LAM RICINUS CASE (SUPRA). THE TOTAL INCOME DECLARED AND ASSESSED FO R THE ASSESSEE FOR THE ASSESSMENT YEAR 1996-97 IS. R.I. (-) RS. 81,30,22,320/- A.I. (-) RS. 37,42,343/- AND FOR ASSESSMENT YEAR 1997-98 IT IS, R.I. (-) RS.124,74,11,325/- A.I. (-) RS. 53,35,24,749/- THEREFORE, APPEAL IS NOT MAINTAINABLE. HON'BLE DEL HI HIGH COURT IN MANGLAM RICINUS LIMITEDS CASE HELD AS UNDER: 4. ON THE BASIS, THE TRIBUNAL CAME TO THE CONCLUSI ON THAT EVEN IF THE ORDER OF THE ASSESSING OFFICER IS UPHELD, THE I NCOME OF THE ASSESSEE WOULD BE NEGATIVE AND, THEREFORE, THE TAX EFFECT WOULD BE CERTAINLY LESS THAN RS. 1 LAKH. ON THIS BASIS, THE TRIBUNAL DECLINED TO ENTERTAIN THE APPEAL. THAT IS HOW THE REVENUE I S BEFORE US UNDER SECTION 260A OF THE INCOME-TAX ACT, 1961. 5. WE ARE IN AGREEMENT WITH THE VIEW OF THE TRIBUNA L THAT EVEN IF THE ORDER OF THE ASSESSING OFFICER IS UPHELD THE TA X RECOVERY SO FAR AS THE REVENUE IS CONCERNED WOULD BE NIL. IN THE E VENT THE QUESTION HAS ANY IMPACT ON SUBSEQUENT YEARS, WE LEAVE IT OPE N TO THE REVENUE TO RAISE IT IN THE SUCCEEDING YEARS, IF NEE D ARISES. 6. LEARNED COUNSEL FOR THE REVENUE SUBMITS THAT THE TAX EFFECT IS NOT REQUIRED TO BE SEEN BUT THE TAX EFFECT ON THE ISSUE INVOLVED IS TO BE SEEN. THIS PRECISELY WHAT THE TRIBUNAL HAS DONE. WE DO NOT FIND ANY ERROR IN THE VIEW TAKEN BY THE TRIBUNAL. 6 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 THIS JUDGMENT WAS FOLLOWED BY ITAT, AHMEDABAD BENCH IN DCIT VS. SANBHAV MEDIA LIMITED ITA NO. 2733/A/2006, ASSESSME NT YEAR 2003-04 PRONOUNCED ON 24-04-2009, WHEREIN, IT IS HELD THAT IF RETURNED INCOME AND ASSESSED INCOME BOTH ARE NEGATIVE, THEN APPEAL FILE D BY THE DEPARTMENT IN LIMINE IS NOT MAINTAINABLE. RESPECTFULLY FOLLOWING THESE DECISIONS, WE HOLD THAT APPEAL FILED BY THE REVENUE IN BOTH THE Y EARS IS NOT MAINTAINABLE. 8. NOTWITHSTANDING, AT THE INSTANCE OF THE DEPARTME NT THAT THE ISSUE IS OF LEGAL NATURE SHOULD BE CONSIDERED ON MERIT ALSO, WE FIND THAT THE FACTS OF THE CASE ARE SIMILAR TO THE FACTS IN THE CASE OF YASHVANT S. TEJANI, WHEREIN TRIBUNAL RENDERED TO SEVERAL DECISIONS AND FINALLY CONCLUDED THAT THE BURDEN CAST ON THE ASSESSEE SHOULD BE TREATED A S DISCHARGED IF IT IS SHOWN BY THE ASSESSEE THAT IT HAS SUFFICIENT INTERE ST FREE CAPITAL OUT OF WHICH IT COULD GIVE INTEREST FREE ADVANCES. IT IS THEREAFTER, FOR THE REVENUE TO SHOW THAT IN SPITE OF THE ASSESSEE HAVIN G INTEREST FREE CAPITAL, INTEREST FREE ADVANCES ARE GIVEN OUT OF INTEREST BE ARING FUNDS. EVEN, THEREAFTER REVENUE HAS TO MEET THE ARGUMENT THAT IN TEREST FREE ADVANCES WERE GIVEN FOR BUSINESS PURPOSES FOLLOWING THE DECI SION OF HON'BLE SUPREME COURT IN SA BUILDERS V/S CIT(A) (2007) 288 ITR 01. ACCORDING TO HON'BLE SUPREME COURT, IF INTEREST FRE E ADVANCES ARE GIVEN FOR BUSINESS PURPOSES, THEN NO DISALLOWANCE OF INTE REST IS REQUIRED TO BE MADE IRRESPECTIVE OF WHETHER THEY ARE GIVEN OUT OF INTEREST FREE CAPITAL OR INTEREST BEARING FUNDS. IN THE PRESENT CASE, REVEN UE HAS NOT DISPROVED THE CLAIM OF THE ASSESSEE, ARISING FROM THE DETAILS OF THE INTEREST FREE ADVANCES GIVEN AND REFERRED TO ABOVE IN THE CHART THAT SUCH INTEREST FREE ADVANCES ARE GIVEN FOR BUSINESS PURPOSES. 7 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 9. NOTWITHSTANDING, THE REVENUE RELIED ON THE DECIS ION OF HON'BLE PUNJAB AND HARYANA HIGH COURT IN ABHISHEK INDUSTRIE S (SUPRA). THIS DECISION WAS FOLLOWED BY HON'BLE PUNJAB HIGH COURT IN MUNJAL SALES CORPORATION VS. CIT (2008) 298 ITR 288 (P&H) WHICH WAS SUBSEQUENTLY REVERSED BY HON'BLE SUPREME COURT IN M UNJAL SALES CORPORATION V/S. CIT (2008) 298 ITR 298 (SC). THE REFORE, THE DECISION OF HON'BLE PUNJAB AND HARYANA HIGH COURT IN ABHISHE K INDUSTRIES (SUPRA) IS NO LONGER A GOOD LAW. 10. FOR THE SAKE OF CONVENIENCE, WE REPRODUCE PARA 13 TO 16 FROM OUR DECISION IN YASHWANT S. TEJANIS CASE AS UNDER: 13. HE ALSO RELIED ON THE FOLLOWING JUDGMENTS. I. SHREE DIGVIJAY CEMENT CO. LTD V/S CIT 138 ITR 4 5 (GUJ) II. CIT V/S GOPIKRISHNA MURALIDHAR, 47 ITR 469 (AP ), III. CIT V/S HOTEL SAVERA 239 JTR 795 (MAD) IV. GNFC V/S CIT 73 TTJ 787 (AHD), V. SHHIBAUG ENTERPRISES V/S CIT 49 TTJ 554 (AHD) AND VI. TORRENT FINANCIERS V/S CII 73 TTJ 624 (AHD) VII. CIT V/S ALOK PAPER INDUSTRIES 138 JTR 729 VIII. R. V. JOSHI V/S CIT 251 ITR 332 M.P.) 14. WE HAVE HEARD LD. A.R. AND LD. D.R. THE LD. D.R . SUBMITTED THAT ASSESSEE FAILED TO ESTABLISH NEXUS BETWEEN INT EREST FREE FUNDS AND INTEREST FREE ADVANCES GIVEN TO RELATED PERSONS . ON THE OTHER HAND LD. A.R. SUBMITTED THAT NO SUCH DISALLOWANCES WERE MADE IN RESPECT OF ADVANCES TO FIRST 2 PERSONS VIZ. SHRI CH ANDUBHAI PATEL AND KOKILABEN TEJANI TO WHOM ADVANCE IN EARLIER YEA R WERE ALSO GIVEN. SECONDLY, SHRI. MANISH TEJANI IS EMPLOYEE OF THE COMPANY 8 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 AND ADVANCE IS GIVEN TO STAFF. THIRDLY, ASSESSEE HA S SUFFICIENT INTEREST. FREE FUNDS AS STATED BEFORE THE LEARNED C OMMISSIONER OF INCOME TAX(APPEALS). FOLLOWING ADDITIONAL DECISIONS SUPPORT THE CASE OF THE ASSESSEE. TORRENT FINANCIERS V. ACIT (2001) 73 TTJ624 (AHD) CIT. PREM HEA VY ENGG. WORKS (P.) LTD. (2006) 285 I TR 554 CIT. BRITAPINIA INDUSTRIESLTD. (2006) 280 JTR 525 ( CAL) CIT V. RADICO KHAITAN LTD. (2005) 274 ITR 354 (ALL) CIT V. TIN BOX CO. (2003) 260 ITR 637 (DEL) MUNJAL SALES CORPORATION 298 ITR 298 (SC) 15. FINALLY LD. A.R. REFERRED TO THE DECISIONS OF H ONBLE BOMBAY HIGH COURT IN CIT VS. RELIANCE SECURITIES AND POWER LIMITED (2009) 313 ITR 340 BOMBAY FOR THE PROPOSITION THAT PRESUMPTION IS THAT INTEREST FREE ADVANCES WERE GIVEN OUT F INT EREST FREE FUNDS AVAILABLE WITH THE ASSESSEE. 16. WE HAVE CONSIDERED RIVAL SUBMISSIONS AND PERUSE D THE MATERIAL ON RECORD. IN OUR CONSIDERED VIEW LEARNED COMMISSIO NER OF INCOME TAX(APPEALS) WAS JUSTIFIED IN DELETING THE A DDITION. IT IS BECAUSE INTEREST FREE ADVANCES TO KOKILABEN TEJANI & MAHESH S. TEJANI WERE OLD BALANCES AND NO DISALLOWANCE IN THE PAST HAS BEEN MADE. SECONDLY, SHRI. MANISH TEJANI IS AN EMPLOYEE AND INTEREST FREE ADVANCES ARE GIVEN TO HIM FOR COMMERCIAL EXPED IENCY. THIRDLY, LOAN TAKEN FROM BANK ARE APPARENTLY USED FOR PURCHA SING PLANT AND MACHINERY AS EXPLAINED BY LD. A.R. NOTWITHSTANDING ASSESSEE HAS INTEREST FREE FUNDS AND ASSESSING OFFICER IS EXPECT ED TO SHOW THAT EXPLANATION FURNISHED BY THE ASSESSEE THAT IT IS ON LY OUT OF INTEREST FREE FUNDS FROM WHICH INTEREST FREE ADVANCES ARE GI VEN IS NOT 9 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 CORRECT BY POINTING OUT THAT WHEN MONEY WAS GIVEN T O THE FRIENDLY PERSONS, THE ASSESSEE HAD BUILT UP CASH BALANCES BY BORROWING INTEREST BEARING LOANS FROM THE BANK OR FROM OTHER PERSONS AND HAD HE NOT BORROWED FUNDS ON INTEREST, HE COULD NOT HAVE GIVEN SUCH ADVANCES TO FRIENDLY PERSONS WITHOUT INTEREST, AS HE WOULD NOT HAVE ADEQUATE CASH BALANCE AT THE POINT OF TIME WHE N HE MADE INTEREST FREE ADVANCES. THE ONUS IS NEVER FIXED, IT GOES ON SHIFTING FROM ASSESSING OFFICER TO ASSESSEE AND FROM ASSESSE E TO ASSESSING OFFICER, DEPENDING UPON EVIDENCE AND EXPLANATION FU RNISHED BY THE PARTIES. IF, THE ASSESSEE HAS FURNISHED AN EXPLANAT ION THAT IT HAS SUFFICIENT INTEREST FREE ADVANCES, THEN ASSESSEE HA S PRIMA-FACIE DISCHARGED THE ONUS AND IT IS NOW THE DUTY OF THE A SSESSING OFFICER TO SHOW THAT ASSESSEE DID NOT HAVE SUFFICIENT INTER EST FREE FUND, AVAILABLE AT THE POINT OF TIME WHEN HE HAD GIVEN IN TEREST FREE ADVANCES. HE CAN DO SO BY CALLING DIRECTLY OR FROM ASSESSEE. COPIES OF BANK ACCOUNT SHOWING RECEIPT & TRANSFER O F THE FUNDS IN QUESTION. MERELY, REJECTING THE EXPLANATION OF THE ASSESSEE IS NOT SUFFICIENT. THE VIEW OF HONBLE BOMBAY HIGH COURT I N RELIANCE UTILITIES AND POWER LIMITED GIVES CLEAR INDICATION THAT IF ASSESSEE HAS SUFFICIENT INTEREST FREE FUNDS, THEN IT SHALL B E PRESUMED THAT INTEREST FREE ADVANCES WAS GIVEN OUT OF INTEREST FR EE FUNDS. SUCH PRESUMPTION IS REBUTTABLE AND THE, ASSESSING OFFICE R IS EXPECTED TO GIVE HIS FINDING ON THE AVAILABILITY OF CASH AT THE POINT OF TIME WHEN SUCH INTEREST FREE ADVANCES ARE GIVEN. F HE CHOOSES NOT TO DO SO THEN HE LOSES THE RIGHT TO MAKE ADDITION. THIS IS E XACTLY WHAT HAS HAPPENED IN THIS CASE. THEREFORE, ADDITION MADE BY THE ASSESSING OFFICER CANNOT BE JUSTIFIED. AS A RESULT THIS GROUN D OF REVENUE IS REJECTED. 10 ITA NO.85 AND 86/AHD/2007 (ASSESSMENT YEAR 1996-1997 AND 1997-1998 17. FINALLY, APPEAL FILED BY THE REVENUE IS DISMISS ED. 12. RESPECTFULLY FOLLOWING ABOVE DECISIONS, WE HOLD THAT EVEN ON MERIT, REVENUE HAS NO CASE. 13. AS A RESULT, BOTH THE APPEALS FILED BY THE REVE NUE ARE DISMISSED. THIS ORDER IS PRONOUNCED IN OPEN COURT ON DATED 16 TH OCTOBER, 2009. SD/- SD/- (T.K. SHARMA) (D.C. AGRAWAL) JUDICIAL MEMBER ACCOUNTA NT MEMBER AHMEDABAD; DATED: 16/10/2009 ANKIT* COPY OF THE ORDER FORWARDED TO: 1. THE APPELLANT 2. THE RESPONDENT 3. THE CIT(A) CONCERNED 4. THE CIT, 5. THE DR, AHMEDABAD BENCH 6. THE GUARD FILE. BY ORDER, ASSTT. REGISTRAR/ DEPUTY REGISTRAR ITAT, AHMEDABAD BENCHES, AHMEDABAD.