Shri Hari Agro Industries Ltd., Kolkata V. D.C.I.T Cir - 9,kolkata., Kolkata

ITA 86/KOL/2013

• Counselvise Citation: [2015] 140 COUNSELVISE.COM (IT) 99880 (ITAT-KOLKATA)
• Duration Of Justice: 2 year(s) 9 month(s)
• Appeal Type: Income Tax Appeal
• Pronouncement Date: 16-10-2015
• Appeal Filed By: Assessee
• Bench Allotted: B
• Assessment Year: 2009-2010
• Appeal Filed On: 15-01-2013
• Court: TRIBUNAL
• Department Lawyers: NIRAJ KUMAR
• Assessee Lawyers: A K TIBREWAL; AMIT AGARWA
• Keywords: Rejection of books of accounts; Capital asset; Opportunity of cross examination; Additional evidence; Corroborative evidences; Capital expenditure
• Section: 43B

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL, BEN CH B, KOLKATA [BEFORE HONBLE SHRI N.V.VASUDEVAN, JM & SHRI WAS EEM AHMED, AM] ITA NO.86/KOL/2013 ASSESSMENT YEAR : 2009-10 (APPELLANT ) (RESPONDENT) SHREE HARI AGRO INDUSTRIES LTD. -VERSUS- D.C.I.T., CIRCLE-9, KOLKATA KOLKATA (PAN:AADCS 7756 H) ITA NO.284/KOL/2013 ASSESSMENT YEAR : 2009-10 D.C.I.T., CIRCLE-9, -VERSUS- M/S. SHREE HARI AGRO INDUSTRIES LTD. KOLKATA KOLKATA (PAN AADCS 7756 H) (APPELLANT) (RESPONDENT) FOR THE DEPARTMENT : SHRI NIRAJ KUMAR, CIT(DR) FOR THE ASSESSEE : SHRI A.K.TIBREWAL, FCA & SHRI AMIT AGARWAL, ADVOCATE DATE OF HEARING : 05.10.2015. DATE OF PRONOUNCEMENT : 16.10.2015. ORDER PER SHRI N.V.VASUDEVAN, JM ITA NO.86/KOL/2013 IS AN APPEAL BY THE ASSESSEE WHILE ITA NO.284/KOL/2013 IS AN APPEAL BY THE REVENUE. BOTH T HESE APPEALS ARE DIRECTED AGAINST THE ORDER DATED 08.11.2012 OF CIT(A)-VIII, KOLKATA RELATING TO A.Y.2009-10. ITA NO.86/KOL/2013 (ASSESSEES APPEAL) : 2. GROUND NOS. 1 AND 2 RAISED BY THE ASSESSEE IN THIS APPEAL AND THE GROUNDS OF APPEAL RAISED BY THE REVENUE IN ITS APPEAL CAN B E CONVENIENTLY TAKEN TOGETHER. THE ASSESSEE IS A COMPANY ENGAGED IN THE BUSINESS O F MANUFACTURE OF AGRO PRODUCTS. IN THE COURSE OF ASSESSMENT PROCEEDINGS, THE AO NOTICED THAT THE ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 2 ASSESSEE HAS SHOWN A SUM OF RS.14,58,61,553 AS CAP ITAL RESERVE IN THE LIABILITY SIDE OF THE BALANCE SHEET. THE ASSESSEE EXPLAINED THAT THE INCREASE IN THE CAPITAL RESERVE WAS BECAUSE OF WAIVER OF LOANS WHIC H THE ASSESSEE HAD OBTAINED FOR THE PURPOSE OF ITS BUSINESS, BY THE CREDITORS O WING TO FINANCIAL CRISIS WHICH THE ASSESSEE FACED. THE LOAN CREDITORS AGREED FOR WAIVER OF PART OF THE LOANS AND ACCORDINGLY, THE AMOUNT OF LOANS TOGETHER WITH INTEREST SO WAIVED HAS BEEN TREATED AS CAPITAL RESERVE BROUGHT TO THE BALANCE SHEET. THE ASSESSEE FURNISHED THE PARTY-WISE DETAILS OF LOANS AND THE INTEREST WA IVED, WHICH WAS AS UNDER : NAME OF THE LOAN CREDITOR BALANCE AS ON 01.04.2008 AMOUNT WAIVED BALANCE AS ON 31.03.2009 DEEPAK VEGPRO P LTD (SECURED LOAN) 45000,000 31500,000 13500,000 KN RAVINDRA KUMAR (HUF) 1250,000 1000,000 250,000 SHREE HARI INDUSTRIES 1685,145 1348,117 337,028 VERSA TRADING CO. 896,439 717,151 179,288 ANITA AGARWAL 1250,000 1000,000 250,000 DEEPAK VEGPRO P LTD (UNSECURED LOAN) 28500,000 22800,000 5700,000 TOTAL 78,581,584 58,365,268 20,216,316 FURTHER, THE PERUSAL OF THE ASSESSEES BALANCE SHEE T SHOWED THAT THE FOLLOWING ITEMS OF LOANS AND THEIR INTERESTS HAVE BEEN REDUCE D FROM THE CLOSING BALANCES AS ON 31.03.2008 TO THE PRESENT BALANCES AS ON 31.03.2 009 PARTICULARS BALANCE AS ON 31.03.2008 BALANCE AS ON 31.03.2009 DIFFERENCE ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 3 UNSECURED LOANS FROM ASSOCIATE CONCERNS 1,70,09,882 1,41,94,613 28,15,269 UNSECURED LOANS FROM OTHERS 9,49,55,478 2,41,13,612 7,08,41,886 SECURE LOAN DEEPAK VEGPRO P LTD 4,50,00,000 1,35,00,000 3,15,00,000 INTERESST ACCRUED & DUE 7,09,96,285 0 7,09,96,285 TOTAL 17,61,53,420 THE ABOVE DIFFERENCE OF RS.17,61,53,420 WAS MAINLY DUE TO THE WAIVER OF LOANS AND THEIR INTEREST. IN OTHER WORDS, THE WAIVER OF L OANS TOGETHER WITH INTEREST (WHICH WAS CONSIDERED AS CAPITAL RESERVE BY THE ASS ESSEE) WAS OUT OF THE ABOVE DIFFERENCE OF RS.17,61,53,420. 3. THOUGH THE LOAN AND INTEREST WAIVED WAS RS.17,6 1,53,420/-, THE ADDITION TO THE CAPITAL RESERVE ACCOUNT WHICH WAS CONSIDERED BY THE AO FOR THE IMPUGNED ADDITION MADE WAS ONLY A SUM OF RS.14,58,61,553/-. THE CAPITAL RESERVES SHOWN BY THE ASSESSEE IN THE BALANCE SHEET COMPRISED OF I NTEREST ACCRUED AND DUE AND RS.7,09,96,285/- WHICH WAS INTEREST ON LOANS WHICH WERE DEBITED FROM TIME TO TIME. THE REMAINING AMOUNT OF RS.7,48,65,268/- WAS ON ACCOUNT OF BENEFIT OBTAINED BY THE ASSESSEE CONSEQUENT TO WAIVER OF P RINCIPAL AMOUNT BY THE BANKS AND OTHER CREDITORS. THE AO WAS OF THE VIEW T HAT THE AMOUNT OF WAIVE OF LOAN AND INTEREST DUE THEREON WAS TAXABLE U/S 41(1) OF THE ACT R.W.S.28(I) & (IV) OF THE ACT AS REMISSION OR CESSATION OF LIABILITY W HICH PROFIT ARISING IN THE COURSE OF BUSINESS. AO ACCORDINGLY ADDED A SUM OF RS.14,58 ,61,553/- TO THE TOTAL INCOME OF THE ASSESSEE. ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 4 4. ON APPEAL BY THE ASSESSEE THE CIT(A) HELD THAT IN SO FAR AS THE WAIVER OF THE PRINCIPAL AMOUNT OF THE LOAN BY THE BANKS ARE CONCE RNED THE SAME WAS LIABLE TO BE TAXED FOR THE REASONS THAT THE ASSESSEE HAD NOT ESTABLISHED BY EVIDENCES THAT THE LOANS WAIVED BY THE BANKS AND OTHER CREDITORS W ERE BORROWED FOR THE PURPOSE OF MEETING THE CAPITAL EXPENDITURE. IN SO F AR AS THE INTEREST PORTION WHICH WAS WAIVED BY THE BANK AND CREDITOR IS CONCER NED THE CIT(A) FOUND THAT INTEREST PORTION WHICH WAS WAIVED HAD BEEN CLAIMED AS DEDUCTION BY THE ASSESSEE BY COMPUTING THIS TAXABLE INCOME PROVISION OF SECTION 41(1) OF THE ACT WERE NOT ATTRACTED. CIT(A) ALSO HELD THAT THE INCOM E IN QUESTION CANNOT BE ADDED U/S 28(IV) OF THE ACT FOR THE REASONS THAT TH E BENEFIT WAS IN TERMS OF MONEY AND THE PROVISION OF SECTION 28(IV) OF THE AC T WILL APPLY ONLY WHEN THE BENEFIT OR PERQUISITE IS RECEIVED IN KIND. 5. THE FOLLOWING OBSERVATIONS OF THE CIT(A) IN THI S REGARD ARE AS FOLLOWS : I HAVE CAREFULLY CONSIDERED THE SUBMISSION OF THE APPELLANT ALONG WITH THE SUPPORTING EVIDENCES/DETAILS FURNISHED & CASE LAWS RELIED UPON, PERUSED THE FACTS OF THE CASE INCLUDING THE IMPUGNED ASSESSMENT ORDER, REMAND REPORT AND REJOINDER TO THE REMAND REPORT AND OTHER MATERI ALS BROUGHT ON RECORD. I DO NOT FIND ANY FORCE IN THE ARGUMENT PUT FORWARD B Y THE APPELLANT. THEREFORE, THESE GROUNDS OF THE APPEAL OF THE APPEL LANT REGARDING THE ADDITION OF RS.7,48,65,268/- ON ACCOUNT OF WAIVER O F UNSECURED LOAN AND OF RS.7,09,96,285/- ON ACCOUNT OF WAIVER OF INTEREST O N SECURED LOAN ARE DECIDED AS UNDER :- (I)IT IS NOT IN DISPUTE THAT THE APPELLANT HAS WRIT TEN OFF IN BOOKS OF ACCOUNTS INTEREST OF RS.7,09,96,285/- AS PER THE LD AR THE A PPELLANT HAS NOT BEEN ALLOWED DEDUCTION OF THIS INTEREST IN VIEW OF PROVI SION OF SECTION 43B OF THE ACT. THE AO IN HIS REPORT HAS SUBMITTED THAT THIS P LEA WAS NOT RAISED DURING THE ASSESSMENT PROCEEDING YEAR AND FOR THIS REASON THE APPLICABILITY OF SECTION 28(IV) OF THE ACT WAS NOT CONSIDERED DURIN G THE ASSESSMENT PROCEEDING. THE AO HAS SUBMITTED THAT EVEN IF THE A DDITION OF RS.7,09,96,285/- IS NOT SUSTAINED UNDER SECTION 41( 1) OF THE ACT THEN THE SAME MAY BE SUSTAINED UNDER SECTION 28(IV) OF THE A CT. A COPY OF REMAND ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 5 REPORT WAS GIVEN TO LD AR AND HE WAS DIRECTED TO ST ATE WHY THE ADDITION BE NOT SUSTAINED UNDER SECTION 28(IV) OF THE ACT. IN REPLY THE LD AR HAS RELIED IN MADRAS HIG H COURT DECISION IN THE CASE OF ISKRAEMECO REGENT LTD CIT (2011) 331 ITR 3 17. IN THIS CASE THE HONBLE MADRAS HIGH COURT RELYING ON BOMBAY HIGH CO URT DECISION IN THE CASE OF MAHINDRA & MAHINDRA LTD. V CIT (2003) 261 I TR502 AND HONBLE DELHI HIGH COURT DECISION IN THE CASE OF RAVINDER SINGH V CIT (1994) 205 ITR 353, HAS HELD AS UNDER :- THAT SECTION 28(IV) OF THE ACT SPEAKS ABOUT THE BE NEFIT OR PERQUISITE RECEIVED IN KIND AND HAS NO APPLICATION TO ANY TRAN SACTION WHICH INVOLVES MONEY. THE TRANSACTION IN QUESTION BEING A LOAN TRA NSACTION HAVING NO APPLICATION WITH RESPECT TO SECTION 28(IV) OF THE I NCOME-TAX ACT, THE SUM IN QUESTION WAS NOT INCOME WITHIN THE PURVIEW OF SE CTION 2(24) OF THE ACT. IN VIEW OF THE ABOVE DISCUSSED LEGAL AND F ACTUAL POSITION THE ADDITION OF RS.7,09,96,285/- ON ACCOUNT OF WAIVER OF INTERES T AT THE TIME OF ONE TIME SETTLEMENT OF THE LOAN CANNOT BE SUSTAINED EITHER U NDER SECTION 28(IV) OR UNDER SECTION 41(1) OF THE ACT AND ACCORDINGLY THE ADDITION OF RS.7,09,96,285/- IS DELETED. (II) THE LD AR HAS SUBMITTED THAT THE APPELLANT HAS TAKEN SECURED LOAN OF RS.340 LACS FROM INDUSTRIAL RECONSTRUCTION BANK OF INDIA AND 450 LACS. FROM IDBI BANK IN THE YEAR 1996-97 UNDER PROJECT FINANCE SCHEME. HOWEVER, NEITHER THE SANCTION LETTER NOR ANY OTHER EVIDENCE TO SUPPORT THE CONTENTION THAT THESE LOANS WERE TAKEN FOR THE ACQU ISITION OF CAPITAL ASSET WAS FILED. SIMILARLY NO EVIDENCE WAS PRODUCED TO SU STAIN THE CLAIM THAT THE LOAN RETURN OF DURING THE YEAR WERE THE SAME LOAN W HICH WERE TAKEN IN THE FINANCIAL YEAR 1996-97. SINCE THE APPELLANT HAS NOT DISCHARGED ONUS CAST ON IT EITHER BEFORE THE AO OR BEFORE ME HENCE I AM CONSTRAINED TO PRESUME THAT THE FACTUAL POSITION IS NOT IN FAVOUR OF THE APPELLANT AND THESE LOANS WERE OBTAINED FOR DAY TO DAY WORKING OF THE COMPANY. IN THE LOGITRONICS PVT. LTD. V CIT (ITA NO.1623 OF 2010) THE HONBLE DELHI HIGH COURT HAS HELD AS UNDER :- THE ANSWER TO THE QUESTION WHETHER THE WAIVER OF A LOAN IS TAXABLE AS INCOME OR NOT DEPENDS ON THE PURPOSE FOR WHICH THE LOAN WAS TAKEN. IF THE LOAN WAS TAKEN FOR ACQUIRING A CAPITAL ASSET, THE W AIVER THEREOF WOULD NOT AMOUNT TO ANY INCOME EXIGIBLE TO TAX U/S 28(IV) OR 41(1). ON THE OTHER HAND, IF THE LOAN WAS TAKEN FOR A TRADING PURPOSE A ND WAS TREATED AS SUCH FROM THE VERY BEGINNING IN THE BOOKS OF ACCOUNT, IT S WAIVER WOULD RESULT ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 6 IN INCOME MORE SO WHEN IT WAS TRANSFERRED TO THE P& L A/C IN VIEW OF SUNDARAM IYENGAR 222 ITR 344(SC). IN VIEW OF ABOVE DISCUSSED LEGAL AND FACTUAL POSIT ION I AM OF THE VIEW THAT THE AO WAS JUSTIFIED IN ADDING RS.7,48,65,268/- TO THE INCOME. ACCORDINGLY THE ADDITION OF RS.7,48,65,268 IS CONFIRMED. 6. AGGRIEVED BY THE RELIEF GRANTED BY THE CIT(A) T HE REVENUE IN APPEAL BEFORE THIS TRIBUNAL. AGGRIEVED BY THE ORDER OF CIT(A) UPH OLDING THE ADDITION ON ACCOUNT OF WAIVER OF PRINCIPAL AMOUNT OF THE LOAN THE ASSESEE IS IN APPEAL BEFORE THIS TRIBUNAL. 7. WE HAVE HEARD THE SUBMISSIONS OF THE LD. DR AND THE LEARNED COUNSEL FOR THE ASSESSEE ON THE AFORESAID ISSUES. THE LD. COUNS EL FOR THE ASSESSEE PLACED RELIANCE ON THE DECISION OF THE HONBLE MADRAS HIGH COURT IN THE CASE OF ISKRAEMECO REGENT LTD. VS CIT 331 ITR 317(MAD). HIS SUBMISSION WAS THAT THE HONBLE MADRAS HIGH COURT IN THE AFORESAID DECI SION HAS HELD THAT THE PROVISION OF SECTION 41(1) OF THE ACT CAN BE APPLIE D ONLY WHEN THE BORROWING IS BY A FINANCIAL INSTITUTION FOR WHICH MONEY WAS AN I TEM OF TRADING TRANSACTIONS AND IN RESPECT OF ALL OTHER BUSINESSES BORROWINGS S HOULD BE CONSIDERED ONLY ON CAPITAL ACCOUNT. HIS SUBMISSION WAS THAT IN THE LIG HT OF THE JUDICIAL PRONOUNCEMENT IT WAS UNNECESSARY TO GO INTO THE QUE STION AS TO WHETHER THE PRINCIPAL AMOUNT WAIVED WAS IN RESPECT OF LOAN BORR OWED FOR MEETING THE CAPITAL REQUIREMENTS OR FOR MEETING THE REVENUE EXP ENDITURE. 8. WE HAVE CONSIDERED HIS SUBMISSIONS AND ARE OF T HE VIEW THAT THE SAME CANNOT BE ACCEPTED. IT IS NO DOUBT TRUE THAT IN THE AFORESAID CASE THE HONBLE MADRAS HIGH COURT HAS OBSERVED THAT THE ASSESSEE WA S NOT TRADING IN ANY MONEY TRANSACTION AND ON THE GROUND OF LOAN BY A BANK CAN NOT BE TERMED AS TRADING TRANSACTION AND IT CANNOT BE CONSTRUED IN THE COURS E OF BUSINESS. THIS OBSERVATION IN OUR VIEW CANNOT BE READ IN ISOLATION AND OUT OF CONTEXT. THE ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 7 HONBLE MADRAS HIGH COURT IN THE AFORESAID DECISION FOUND THAT THE UNDISPUTED FACT PREVAILING IN THAT CASE WAS THAT THE ASSESSEE OBTAINED LOAN FOR THE PURPOSE OF INVESTMENT IN ITS CAPITAL ASSET. IT IS ONLY ON THIS BASIS THAT THE HONBLE MADRAS HIGH COURT HELD THAT THE PROVISION OF SECTION 41(1) OF THE ACT OR SECTION 28(IV) OF THE ACT ARE NOT ATTRACTED. THE HONBLE SUPREME COURT IN THE CASE OF SUN ENGINEERING WORKS PVT. LTD. 198 ITR 287 (SC), HAS H ELD AS FOLLOWS: IT IS NEITHER DESIRABLE NOR PERMISSIBLE TO PICK OU T A WORD OR A SENTENCE FROM THE JUDGMENT OF THIS COURT, DIVORCED FROM THE CONTEXT OF THE QUESTION UNDER CONSIDERATION AND TREAT IT TO BE THE COMPLETE 'LAW' DECLARED BY THIS COURT. THE JUDGMENT MUST BE READ A S A WHOLE AND THE OBSERVATIONS FROM THE JUDGMENT HAVE TO BE CONSIDERE D IN THE LIGHT OF THE QUESTIONS WHICH WERE BEFORE THIS COURT. A DECISION OF THIS COURT TAKES ITS COLOUR FROM THE QUESTIONS INVOLVED IN THE CASE IN W HICH IT IS RENDERED AND, WHILE APPLYING THE DECISION TO A LATER CASE, THE CO URTS MUST CAREFULLY TRY TO ASCERTAIN THE TRUE PRINCIPLE LAID DOWN BY THE DE CISION OF THIS COURT AND NOT TO PICK OUT WORDS OR SENTENCES FROM THE JUDGMEN T, DIVORCED FROM THE CONTEXT OF THE QUESTIONS UNDER CONSIDERATION BY THI S COURT, TO SUPPORT THEIR REASONING. IT IS NEITHER DESIRABLE NOR PERMIS SIBLE TO PICK OUT A WORD OR A SENTENCE FROM THE JUDGMENT OF THIS COURT, DIVO RCED FROM THE CONTEXT OF THE QUESTION UNDER CONSIDERATION AND TREAT IT TO BE THE COMPLETE 'LAW' DECLARED BY THIS COURT. THE JUDGMENT MUST BE READ A S A WHOLE AND THE OBSERVATIONS FROM THE JUDGMENT HAVE TO BE CONSIDERE D IN THE LIGHT OF THE QUESTIONS WHICH WERE BEFORE THIS COURT. A DECISION OF THIS COURT TAKES ITS COLOUR FROM THE QUESTIONS INVOLVED IN THE CASE IN W HICH IT IS RENDERED AND, WHILE APPLYING THE DECISION TO A LATER CASE, THE CO URTS MUST CAREFULLY TRY TO ASCERTAIN THE TRUE PRINCIPLE LAID DOWN BY THE DE CISION OF THIS COURT AND NOT TO PICK OUT WORDS OR SENTENCES FROM THE JUDGMEN T, DIVORCED FROM THE CONTEXT OF THE QUESTIONS UNDER CONSIDERATION BY THI S COURT, TO SUPPORT THEIR REASONING. 9. SECTION 41(1) ENACTS A STATUTORY FICTION AND TH E OPERATION OF SUCH FICTION SHOULD BE LIMITED TO THE LANGUAGE OF THE SECTION. IN MAHINDRA & MAHINDRA LTD. VS. CIT 261 ITR 501 (BOM) FOLLOWED IN CIT VS. TOSH A INTERNATIONAL LTD. 331 ITR 440 (DEL) IT WAS HELD THAT AMOUNT OF LOAN AND I NTEREST DUE BY ASSESSEE TO BANKS AND FINANCIAL INSTITUTIONS HAVING NEVER BEEN CLAIMED BY ASSESSEE AS DEDUCTION, WAIVER OF INTEREST AND PART OF PRINCIPAL AMOUNT BY BANKS/FINANCIAL INSTITUTIONS DID NOT GIVE RISE TO PROFITS CHARGEABL E TO TAX UNDER S. 41(1). IN ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 8 ROLLATAINERS LTD. VS. CIT (2011) 339 ITR 54 (DEL), IT WAS HELD THAT LOAN TAKEN BY ASSESSEE ON CASH CREDIT ACCOUNT WHICH WAS USED I N PURCHASE OF CAPITAL ASSET WAIVED BY BANK. LOAN WAS RECEIVED IN THE COURSE OF CARRYING ON DAY-TO-DAY BUSINESS AND AFTER WAIVER, WAS TAKEN TO P&L A/C. TH US, EVEN IF S. 28(IV) WAS NOT APPLICABLE, S. 41(1) WAS CLEARLY APPLICABLE. 10. WE ARE THEREFORE OF THE VIEW THAT IT WAS NECES SARY FOR THE ASSESSEE TO ESTABLISH THE PURPOSE OF THE LOANS IN QUESTION HAD BEEN BORROWED. 11. WE HAVE PERUSED THE DOCUMENTS FILED BY THE ASSE SSEE IN SUPPORT OF ITS CONTENTIONS THAT THE AMOUNT OF LOAN THAT WAS WAIVED BY THE CREDITORS WAS FOR MEETING THE CAPITAL REQUIREMENTS. AT THE TIME OF HE ARING IT WAS NOTICED THAT THE EVIDENCE FILED BY THE ASSESSEE IN THIS REGARD DOES NOT CONCLUSIVELY ESTABLISH THE ASSESSES CASE. FOR E.G. THE ASSESSEE HAD AVAILED TWO MAJOR LOANS WHICH ARE THE SUBJECT MATTER OF WAIVER. THE FIRST LOAN IS ONE WHI CH WAS AVAILED FORM IDBI ON 13.06.1996. THE OTHER MAJOR LOAN IS ONE AVAILED BY THE ASSESSEE FROM IRBI ON 22.01.1997. COPY OF THE LOAN SANCTIONING LETTERS A RE AT PAGES 76 AND 83 OF THE ASSESSEES PAPER BOOK. IT IS NO DOUBT TRUE THAT THA T THESE LOANS REFER TO PROJECT FINANCES THEREBY IT CAN BE SENT THAT THESE LOANS WE RE MEANT FOR MEETING CAPITAL EXPENDITURE. IT IS HOWEVER SEEN THAT THE LOAN AMOUN T WAIVED WAS BY ONE DEPAK VEGPRO PRIVATE LIMITED. WHEN THIS WAS POINTED OUT B Y THE LD. COUNSEL FOR THE ASSESSEE IT WAS SUBMITTED THAT IDBI HAD ASSIGNED TH E LOANS TO M/S.DEEPAK VEGPRO PVT.LTD. A COPY OF THE ASSIGNMENT AGREEMENT IS PLACED AT PAGES 15 TO 31 OF ASSESSEES PAPER BOOK NO.2. THIS DOES NOT CO RRELATE WITH THE LOAN BORROWED BY THE ASSESSEE FROM IDBI, AS A PERSON REF ERRED TO THEREIN IS STRESSED ASSETS STABILISATION FUND WHICH IS STATED TO BE A T RUST FORMED BY IDBI, TO WHOM IDBI IS STATED TO HAVE ASSIGNED THE LOAN GIVEN BY I T TO THE ASSESSEE. ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 9 12. WE ARE OF THE VIEW THAT THE CORRELATION OF THE LOANS BORROWED BY THE ASSESSEE AND THE PURPOSE FOR WHICH THEY WERE BORROW ED AND THE LOANS WAIVED AT RS.7,48,65,268 TO THE ASSESSEE HAS TO BE ESTABLISHE D BY THE ASSESSEE. IN THE ABSENCE OF CORRELATION IT IS NOT POSSIBLE TO DECIDE THE PURPOSE FOR WHICH THE LOAN HAS BEEN AVAILED BY THE ASSESSEE. IT IS ONLY WHEN T HE PURPOSE OF THE LOAN IS ASCERTAINED IT CAN BE DECIDED AS TO WHETHER THE PRO VISION OF SECTION 41(1) OF THE ACT WILL BE ATTRACTED OR NOT. WE THEREFORE SET ASID E THE ORDER OF THE CIT(A) IN SO FAR AS THE ADDITION OF RS.7,48,65,268/- SUSTAINED B Y THE CIT(A) AND REMAND THE ISSUE TO THE AO FOR FRESH CONSIDERATION IN THE LIGH T OF THE OBSERVATIONS MADE ABOVE. THE ASSESSEE IS AT LIBERTY TO FILE THE REQUI RED DOCUMENTS TO SUBSTANTIATE ITS CASE REGARDING NON APPLICABILITY OF THE PROVISION O F SECTION 41(1) OF THE ACT OR SECTION 28(IV) OF THE ACT. 13. IN SO FAR AS THE APPEAL OF THE REVENUE IS CONCE RNED IT IS QUITE CLEAR THAT FROM THE ORDER OF THE CIT(A) THAT THE INTEREST WHIC H WAS WAIVED WAS NOT CLAIMED AS AN EXPENDITURE BY THE ASSESSEE IN THE PA ST AND THEREFORE THE ADDITION OF THE SAID SUM U/S 41(1) OF THE ACT CANNOT BE SUST AINED. IN SO FAR AS THE APPLICABILITY OF THE PROVISION OF SECTION 28(IV) OF THE ACT IS CONCERNED THE BENEFIT IN QUESTION WAS NOT RECEIVED IN KIND AND TH EREFORE THE ADDITION ON THE ABOVE SAID PROVISION CANNOT BE SUSTAINED. THE DECIS ION REFERRED TO BY THE CIT(A) IN THE IMPUGNED ORDER ON THIS ISSUE CLEARLY SUPPORT THE CONCLUSION ARRIVED AT BY THE CIT(A). WE THEREFORE DO NOT FIND ANY GROUND TO INTERFERE. CONSEQUENTLY THE APPEAL FILED BY THE REVENUE IS DIS MISSED. 14. GROUND NO.4,5 AND 6 RAISED BY THE ASSESSEE ARE IN RELATION TO ADDITION OF RS.2 CRORES MADE BY THE ASSESSEE ON ACCOUNT OF UNEX PLAINED SHARE APPLICATION MONEY. THE FACTS IN THIS REGARD ARE THAT THE AO NOT ICED FORM THE PERUSAL OF THE BALANCE SHEET THAT THE ASSESSEE HAS RECEIVED SHARE APPLICATION MONEY OF RS.,2 CRORES. THE ASSESSEE WAS ASKED TO GIVE THE DETAILS OF THE NAMES AND ADDRESSES OF ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 10 THE SHARE APPLICANTS, MODE OF RECEIPT OF SHARE APPL ICATION MONEY, COPY OF APPLICATION FORM ETC. ACCORDING TO THE AO THE ASSES SEE HAD NOT FILED THE REQUIRED DETAILS. THE AO THEREFORE TREATED THE RECE IPT OF SHARE APPLICATION AS EXPENDITURE AND ADDED THE AFORESAID SUM TO THE TOTA L INCOME OF THE ASSESSEE. 15. BEFORE THE CIT(A) THE ASSESSEE POINTED OUT THA T A SUM OF RS.2 CRORES HAD BEEN GIVEN AS SHARE APPLICATION MONEY BY ONE M/S. S AURABH AGROTECH (P) LTD WHO IS ASSESSED AT ALWAR, RAJASTHAN AND ALSO GAVE T HE ASSESSMENT PARTICULARS OF THE SHARE APPLICANT. THE CIT(A) CALLED FOR REMAND R EPORT FROM THE AO ON THE INFORMATION PROVIDED BY THE ASSESSEE. THE AO OF THE ASSESSEE THEREUPON HAD WRITTEN A LETTER TO ACIT, CIRCLE-1 ALWAR ASSESSING THE SHARE APPLICANT. THE ACIT, CIRCLE-1, ALWAR IN HIS LETTER DATED 9.10.2012 CONFIRMED THAT M/S. SAURABH AGROTECH (P) LTD WAS A REGULAR ASSESSEE OF HIS CIRC LE HAVING A TURNOVER OF RS.150 CRORES AND THAT THE TRANSACTION OF SHARE APP LICATION MONEY GIVEN TO THE ASSESSEE OF RS.2 CRORES IS DULY REFLECTED IN THE B ALANCE SHEET. 16. IN THE REMAND REPORT FILED BY THE AO OF THE AS SESSEE BEFORE CIT(A) THIS ASPECT WAS NOT HIGHLIGHTED NOR THE CIT(A) TOOK COGN IZANCE OF THIS LETTER OF ACIT, CIRCLE-1, ALWAR. THE CIT(A) CONFIRMED THE ORD ER OF THE AO BY OBSERVING THAT THE ASSESSEE HAD NOT FILED THE REQUI RED DOCUMENTS TO EXPLAIN THE CREDIT ENTRY SATISFACTORILY. AGGRIEVED BY THE ORDER OF THE CIT(A) THE ASSESSEE HAS RAISED GROUND NOS. 4,5 AND 6 BEFORE THE TRIBUNAL. 17. WE HAVE HEARD THE RIVAL SUBMISSIONS. IN OUR VIE W AND IN THE LIGHT OF THE LETTER OF THE AO TO SAURABJH AGROTECH (P) LTD., A C OPY OF WHICH IS PLACED AT PAGES 32 TO 39 OF THE ASSESSEES PAPER BOOK NO.2, T HE ADDITIONS SUSTAINED BY THE CIT(A) DESERVES TO BE DELETED. IT IS CLEAR FROM THE EVIDENCE THAT IDENTITY, CAPACITY AND GENUINENESS OF THE TRANSACTION OF THE RECEIPT OF SHARE APPLICATION MONEY OF THE ASSESSEE HAS BEEN CLEARLY ESTABLISHED. IN FACT THE ADDITIONAL ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 11 EVIDENCE IN THE FORM OF CONFIRMATION FROM THE SHARE APPLICANT OUGHT TO HAVE ADMITTED BY THE CIT(A) AS ADDITIONAL EVIDENCE AND I N THE LIGHT OF THE ENQUIRY CARRIED OUT BY THE AO WHICH CLEARLY ESTABLISHED T HE RECEIPT OF SHARE APPLICATION MONEY AS GENUINE, THE ADDITION OUGHT TO HAVE BEEN DELETED. WE THEREFORE DIRECT THAT THE ADDITION SUSTAINED BY THE CIT(A) IN THIS R EGARD SHOULD BE DELETED. GROUND NOS.4 TO 6 RAISED BY THE ASSESSEE ARE ACCORD INGLY ALLOWED. 18. GROUND NOS. 7 AND 8 RAISED BY THE ASSESSEE READ AS FOLLOWS :- 7. THAT THE LEARNED COMMISSIONER OF INCOME TAX (AP PEALS) HAS ERRED IN LAW IN CONFIRMING THE DISALLOWANCE OF RS.76,07.212 ON ACCOUNT OF ALLEGED EXCESS CONSUMPTION OF HEXANE IN SOLVENT EXTRACTION PLANT MADE BY THE ASSESSING OFFICER DESPITE THE FACT THAT THE LEARNED ASSESSING OFFICER NEITHER REJECTED THE BOOKS OF ACCOUNTS NOR INVOKED THE PROV ISIONS OF SECTION 145(3) OF THE INCOME TAX ACT, 1961. 8. THAT WITHOUT PREJUDICE TO GROUND NO.7 ABOVE, TH E LEARNED COMMISSIONER OF INCOME TAX (APPEALS) HAS ERRED IN C ONFIRMING THE DISALLOWANCE OF RS.76,07,212 ON ACCOUNT OF ALLEGED EXCESS CONSUMPTION OF HEXANE RELYING ON AN UNAUTHENTICATED REPORT OF SOME UNIDENTIFIED PERSON NAMED MR. P.J.RAO, AND WITHOUT CONSIDERING THE DETA ILS, EVIDENCES AND SUBMISSIONS OF THE APPELLANT. 19. AS FAR AS THE AFORESAID GROUNDS OF APPEAL RAIS ED BY THE ASSESSEE ARE CONCERNED THE FACTS ARE THAT THE ASSESSEE IS IN TH E BUSINESS OF MANUFACTURING OF AGRO PRODUCTS. HEXANE IS A CHEMICAL WHICH IS USED I N THE MANUFACTURING PROCESS BY THE ASSESSEE. THE CONSUMPTION OF HEXANE BY THE A SSESSEE DURING THE PREVISOUS YEAR WAS 3,46,753 LTS. THE COST OF 1 LT I S RS.37.71 AND THE TOTAL COST INCURRED BY THE ASSESSEE ON USE OF HEXANE CLAIMS AS AN EXPENDITURE IN THE PROFIT AND LOSS ACCOUNT AT RS.96,08,526/-. THE AO FOUND TH AT THE HEXANE CHEMICAL WAS USED IN THE PROCESS OF MANUFACTURE OF OIL FROM OIL CAKE. THIS PROCESS HAS TO BE DISTINGUISHED FROM THE MANUFACTURE OF OIL FROM OIL SEEDS. THE CONSUMPTION OF OIL CAKE IN THE PROCESS OF OIL EXTRACTION BY THE AS SESSEE DURING THE PREVIOUS YEAR ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 12 WAS 48,149 MT. THE CONSUMPTION OF HEXANE WITH REFE RENCE TO OIL CAKE CONSUMPTION WAS 7.20 LTS WHICH WORKED OUT AS FOLLOW S :- 3,46,753/ 48,149= 7.20. 20. THE AO WAS OF THE VIEW THAT CONSUMPTION OF HEX ANE PER MT OF OIL CAKE CONSUMED IN EXTRACTION OF OIL HAS TO BE 1.5 LTS. MA XIMUM AND THE CONSUMPTION SHOWN BY THE ASSESSEE WAS EXCESSIVE. IN THIS REGARD AO RELIED ON THE REPORT OF PROF. P.J.RAO, DEPARTMENT OF CHEMICAL ENGINEERING , ANDHRA UNIVERSITY, VISAKHAPATNAM WHO HAS OPINED THAT THE CONSUMPTION OF HEXANE CAN BE A MAXIMUM OF 1.5 LTS. PER MT OF OIL CAKE CONSUMPTION. THE AO BASED ON THE REPORT OF THE EXPERT CAME TO THE CONCLUSION THAT TH E CONSUMPTION OF THE HEXANE SHOWN BY THE ASSESSEE IS EXCESSIVE. THE AO THEREAFT ER MADE ADDITION OF RS.76,07,212/- MAKING FOLLOWING OBSERVATIONS. :- BY THE ABOVE DISCUSSION, IT IS AMPLY CLEAR THAT TH E ASSESSEE INFLATED EXPENSES BY SHOWING MORE HEXANE LOSSES AND REDUCED THE PROFIT. THE BY-PRODUCTS SUCH AS OIL CAKE, WHICH IS RICH IN PROTEIN CONTENT IS HAVING HIGH DEMAND FROM THE PHARMA, FOOD AND CATTLE FEED I NDUSTRY IS ALSO MISREPRESENTED BY SHOWING LESS SALES. SIMILARLY, OT HER CHEMICALS SUCH CAUSTIC SODA, ACIDS ARE ALSO SHOWN AS EXPENDITURE A ND CORRESPONDING USAGE IS NOT SHOWN BY THE ASSESSEES TECHNICAL AND PRODUC TION EXPERTISE. THE PRODUCTION REGISTER, PURCHASE AND SALES VOUCHERS, S TOCK REGISTERS AND RECEIPTS ARE NOT PRODUCED BEFORE ME DESPITE REPEATE D REMINDERS. THEREFORE, THE EXCESS LOSSES/CONSUMPTION OF HEXANE IS DETERMINED AS UNDER: OIL CAKE CONSUMED DURING THE FY 2008-09 : 48,149 MT PROBABLY CONSUMPTION/LOSS OF HEXANE @ 1.5 LT/MT : 72,223.50 LITRES TOTAL CONSUMPTION/LOSS OF HEXANE CLAIMED BY ASSESSE E: 3,46,753.00 LITRES EXCESS CONSUMPTION/LOSS OF THE HEXANE : 2,74,5 29.50 LITRES IN VIEW OF THE ABOVE DISCUSSIONS, THERE IS EXCESS C LAIM OF CONSUMPTION/LOSS OF HEXANE IN THE SOLVENT EXTRACTION OF 2,74,529.50 LITERS AND THE CORRESPONDING COST OF THE SAID EXCESS CONSUMPTION O F HEXANE IS RS.76,07,212. THEREFORE RS.76,07,212 IS DISALLOWED AND BROUGHT TO TAX, BEING EXCESS CLAIM OF EXPENSES. SINCE THE ASSESSEE CONCEALED INCOME BY INFLATING THE EXPENSES BY SHOWING EXCESS LOSSES/CON SUMPTION OF HEXANE, ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 13 PENALTY PROCEEDINGS U/S 271(1)(C) OF THE INCOME TAX ACT ARE SEPARATELY INITIATED. 21. ON APPEAL BY THE ASSESSEE THE CIT(A) CONFIRMED ORDER OF THE AO. THE CIT(A)S OBSERVATIONS ARE AS FOLLOWS :- AFTER CAREFULLY CONSIDERING THE REMAND REPORT OF T HE AO AND THE REJOINDER OF THE APPELLANT TO SUCH REPORT OF THE AO AND PERUSING THE ENTIRE FACTS OF THE CASE, THIS GROUND OF APPEAL OF THE APP ELLANT REGARDING THE DISALLOWANCE ON ACCOUNT OF EXCESS CLAIM OF CONSUMPT ION OF HEXANE IN SOLVENT EXTRACTION PLANT IS DECIDED AGAINST THE APP ELLANT FOR THE FOLLOWING REASONS :- (I) THE AO RELYING ON THE OPINION OF EXPERT HAS WORKED OUT THE CLAIM OF EXCESS CONSUMPTION OF HEXANE OF RS.76,07,212/-. IT IS NOT IN DISPUTE THAT THE REPORT OF EXPERT WAS PROVIDED TO THE APPELLANT. (II) DURING THE ASSESSMENT PROCEEDING, THE APPELLANT AHS NOT PRODUCED STOCK REGISTER ETC. REQUIRED BY THE AO. DUE TO DILATORY T ACTICS OF THE APPELLANT, THE AO WAS NOT ABLE TO VERIFY THE CORRECTNESS OF CONSUM PTION OF HEXANE AND HENCE IT IS HELD THAT THE AO WAS FULLY JUSTIFIED IN RELYING ON THE REPORT OF EXPERT AND WORKING OUT THE EXCESS CONSUMPTION OF HE XANE AMOUNTING TO RS.76,07,212/-. ACCORDINGLY, THE ADDITION OF RS/.76 ,07,212/- MADE BY THE AO IS CONFIRMED. 22. AGGRIEVED BY THE ORDER OF THE CIT(A), THE ASSE SSEE HAS RAISED THE AFORESAID GROUNDS OF APPEAL BEFORE THE TRIBUNAL. 23. BEFORE US THE CONTENTION OF THE LD. COUNSEL F OR THE ASSESSEE WAS THAT THE BOOKS OF ACCOUNTS HAVE NOT BEEN REJECTED BY THE AO U/S.145 OF THE ACT AND THEREFORE THE IMPUGNED ADDITION CANNOT BE SUSTAINED . HIS NEXT SUBMISSION WAS THAT THE IDENTITY OF PROF. P.J.RAO IS NOT CLEAR AND THE ASSESSEE DID NOT HAVE OPPORTUNITY OF CROSS EXAMINATION OF PROF.P.J.RAO. IT WAS ALSO SUBMITTED THAT CONSUMPTION OF HEXANE DURING THE PREVIOUS YEAR COMP ARES FAVOURBLY WITH THE PAST HISTORY AND THERE WAS NO REASON TO IGNORE THE PAST HISTORY IN ASSESSEES OWN CASE. IT IS ALSO POINTED OUT THAT THE ASSESSEE COMP ANY WAS A SICK COMPANY AND ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 14 THERE WAS NO REASON FOR THE ASSESSE TO SHOW HIGHER COST OF PRODUCTION. THE LD. DR, ON THE OTHER HAND, RELIED ON THE ORDERS OF THE AO AND CIT(A). 24. WE HAVE GIVEN A CAREFUL CONSIDERATION TO THE R IVAL SUBMISSIONS. THE PROVISIONS OF SEC.145 OF THE ACT, READS AS FOLLOWS: 145. METHOD OF ACCOUNTING.(1) INCOME CHARGEABLE U NDER THE HEAD 'PROFITS AND GAINS OF BUSINESS OR PROFESSION' OR 'INCOME FROM OT HER SOURCES' SHALL, SUBJECT TO THE PROVISIONS OF SUB-SECTION (2), BE COMPUTED IN A CCORDANCE WITH EITHER CASH OR MERCANTILE SYSTEM OF ACCOUNTING REGULARLY EMPLOYED BY THE ASSESSEE. (2) THE CENTRAL GOVERNMENT MAY NOTIFY IN THE OFFICI AL GAZETTE FROM TIME TO TIME [INCOME COMPUTATION AND DISCLOSURE STANDARDS] TO BE FOLLOWED BY ANY CLASS OF ASSESSEES OR IN RESPECT OF ANY CLASS OF INCOME. (3) WHERE THE ASSESSING OFFICER IS NOT SATISFIED AB OUT THE CORRECTNESS OR COMPLETENESS OF THE ACCOUNTS OF THE ASSESSEE, OR WH ERE THE METHOD OF ACCOUNTING PROVIDED IN SUB-SECTION (1) [HAS NOT BEEN REGULARLY FOLLOWED BY THE ASSESSEE, OR INCOME HAS NOT BEEN COMPUTED IN ACCORDANCE WITH THE STANDARDS NOTIFIED UNDER SUB-SECTION (2),] THE ASSESSING OFFICER MAY MAKE AN ASSESSMENT IN THE MANNER PROVIDED IN SECTION 144. THE AO DID NOT REJECT THE BOOK RESULTS BEFORE RESOR TING TO AN ESTIMATION OF INCOME. FOR REJECTING THE BOOK RESULTS, THE PROVIS IONS OF SEC.145(3) OF THE ACT REQUIRES THAT THE ASSESSING OFFICER SHOULD BE NOT B E SATISFIED ABOUT THE CORRECTNESS OR COMPLETENESS OF THE ACCOUNTS OF THE ASSESSEE, OR WHERE THE METHOD OF ACCOUNTING PROVIDED U/S.145(1) OF THE ACT OR ACCOUNTING STANDARDS AS NOTIFIED UNDER SECTION 145(2) OF THE ACT HAVE NOT B EEN REGULARLY FOLLOWED BY THE ASSESSEE. THE AO HAS TO COMPUTE INCOME FROM BUSINE SS ACCOUNTING TO THE BOOKS OF ACCOUNTS OF THE ASSESSEE. IT IS ONLY WHEN THE BOOK RESULTS ARE REJECTED THE QUESTION OF ESTIMATION OF INCOME ARISES FOR CON SIDERATION. THE AO HAS TO SPECIFICALLY POINT OUT THE DEFECTS IN THE BOOKS OR INCOMPLETE AND INCORRECTNESS IN THE BOOKS OF ACCOUNTS AND CALL UPON THE ASSESSEE AS TO WHY THE BOOKS OF ACCOUNTS SHOULD NOT BE REJECTED. ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 15 25. THE ABOVE PRINCIPLE IS APPLICABLE EVEN WHEN TH E AO DOUBTS THE CORRECTNESS OF THE CLAIM OF EXPENDITURE MADE IN THE PROFIT AND LOSS ACCOUNT. THE AO HAS NOT DOUBTED THE PURCHASE OF HEXANE. HE HAS INDULGE D IN A GUESS WORK REGARDING THE QUANTITY OF HEXANE THAT IS TO BE CONSUMED IN TH E PROCESS OF MANUFACTURE OF OIL FROM OIL CAKE. THE AO HAS DONE THIS ON THE BAS IS OF A REPORT OF AN EXPERT. AS TO WHETHER THE REPORT OF THE EXPERT CAN BE APPLI ED TO ALL MANUFACTURERS OF OIL FROM OIL CAKE AND AS TO WHETHER THESE ARE IDEAL QUA NTITY OF CONSUMPTION, IS NOT SPELT OUT IN THE ORDER OF THE AO. THE ENTRIES IN T HE REGULAR BOOKS OF ACCOUNTS WHICH ARE DULY AUDITED HAVE NOT BEEN SHOWN TO BE SU FFERING FROM ANY INFIRMITIES. THE PAST HISTORY OF CONSUMPTION OF HE XANE COMPARES FAVOURABLY WITH THE CONSUMPTION IN THE PAST AND THE AO HAS NOT HING TO SAY ABOUT THE PAST HISTORY. NO SUCH ADDITION HAS BEEN MADE IN THE PAS T. IN SUCH CIRCUMSTANCES, WE ARE OF THE VIEW THAT THE ADDITION MADE BY THE AO AN D CONFIRMED BY THE CIT(A) WAS WITHOUT ANY BASIS AND CANNOT BE SUSTAINED. WE THEREFORE DIRECT THAT THE ADDITION MADE IN THIS REGARD BE DELETED. THE RELEV ANT GROUNDS OF APPEAL OF THE ASSESSEE ARE ALLOWED. IN VIEW OF THE ABOVE CONCLUS ION, WE HAVE NOT CONSIDERED THE ADDITIONAL EVIDENCE FILED BY THE ASSESSEE IN TH E FORM OF REPORT OF ANOTHER EXPERT SUPPORTING THE CONSUMPTION OF HEXANE BY THE ASSESSEE. 26. IN THE RESULT THE APPEAL BY THE REVENUE IS DIS MISSED WHILE THE APPEAL BY THE ASSESSEE IS PARTLY ALLOWED. ORDER PRONOUNCED IN THE COURT ON 16.10.2015. SD/- SD/- [WASEEM AHMED] [N.V.VASUDEVAN] ACCOUNTANT MEMBER JUDICIAL MEMBER DATE: 16.10.2015. R.G.(.P.S.) ITA NO.86/KOL/2013& 284/KOL/2013 M/S. SHREE HARI AG RO INDUSTRIES LTD.. A.YR.2009-10 16 COPY OF THE ORDER FORWARDED TO: 1. M/S. SHREE HARI AGRO INDUSTRIES LTD., M.C.JAGWAY AN & CO., CHARTERED ACCOUNTANTS, 46, KALI KRISHNA TAGORE STRE ET, 2 ND FLOOR, KOLKATA-700007. 2 THE D.C.I.T., CIRCLE-9, KOLKATA. 3. THE CIT-III, KOLKATA, 4. THE CIT(A)-VIII, KOLKATA. 5. DR, KOLKATA BENCHES, KOLKATA TRUE COPY, BY ORDER, DEPUTY /ASST. REGISTRAR , ITAT, KOLKATA BENCHES