ITO, New Delhi V. Nand Kishore Megh Raj, New Delhi

MA 90/DEL/2011

• Counselvise Citation: [2012] 123 COUNSELVISE.COM (IT) 7507 (ITAT-DELHI)
• Duration Of Justice: 9 month(s) 22 day(s)
• Appeal Type: Miscellaneous Application
• Pronouncement Date: 31-01-2012
• Appeal Filed By: Department
• Order Result: Dismissed
• Bench Allotted: D
• Assessment Year: 2003-2004
• Appeal Filed On: 08-04-2011
• Result in Favour of: Assessee
• Court: TRIBUNAL
• Keywords: Unexplained investment; Rule of consistency
• Section: 69

Judgement Text

IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH E NEW DELHI (FRIDAY) BEFORE SHRI R.P. TOLANI AND SHRI K.D. RANJAN M.A. NO. 90/DEL/2011 ( IN ITA NO.2273/DEL/07 ) ASSTT. YR: 2003-04 INCOME-TAX OFFICER, VS. M/S NAND KISHORE MEGHRAJ, WARD 32(3), NEW DELHI. IIA/78, LAJPAT NAGAR, NEW DELHI. PAN/GIR NO. AAAFN5170E ( APPLICANT ) ( RESPONDENT ) APPLICANT BY : SHRI ROHIT GARG SR. DR RESPONDENT BY: SHRI VED JAIN FCA & MS. RANO JAIN CA O R D E R PER R.P. TOLANI, J.M : THIS IS REVENUES MISC. APPLICATION U/S 254(2) OF T HE I.T. ACT, 1961, AGAINST OF ITAT ORDER DATED 8-5-2009 PASSED IN THE ABOVE CAPTIONED APPEAL, POINTING OUT FOLLOWING MISTAKE IN THE IMPUG NED ORDER: IT IS MOST RESPECTFULLY SUBMITTED THAT IN THE A.Y. 2001-02, THE ADDITIONS WERE MADE BY THE AO ON ACCOUNT OF VALUATI ON OF CLOSING STOCK A WELL AS U/S 69 OF THE ACT ON ACCOUN T OF THE UNEXPLAINED INVESTMENT, THE ADDITION MADE U/S 69 OF THE ACT WAS DELETED BY THE CIT(A) ON THE GROUND THAT THE SA ME WOULD BE COVERED BY THE ADDITION MADE ON ACCOUNT OF VALUA TION OF THE CLOSING STOCK, WHICH WAS UPHELD BY CIT(A). THE ASSE SSEE DIDNT CHALLENGE THE ADDITION MADE ON ACCOUNT OF TH E VALUATION OF THE CLOSING STOCK BEFORE THIS HONBLE TRIBUNAL F OR THE A.Y. 2 2001-02, THEREBY ACCEPTED THE SAME, THUS, THERE WA S NO CONSISTENCY FOLLOWED BY THE ASSESSEE IN THE PRECEDI NG YEARS, HENCE THE FINDING OF THIS HONBLE TRIBUNAL WITH REG ARD TO THE PRINCIPLE OF CONSISTENCY IS INCORRECT AND THEREFORE REQUIRES MODIFICATION. 2. LEARNED DR CONTENDS THAT FOR A.Y. 2001-02 THE A SSESSEE HAS ACCEPTED THE ADDITION MADE ON ACCOUNT OF VALUATION OF CLOSING STOCK BY NOT CHALLENGING THE ORDER OF CIT(A) ON THIS ISSUE BEFO RE THE ITAT, THEREFORE, RULE OF CONSISTENCY DOES NOT APPLY TO ASSESSEES CA SE. 3. LEARNED COUNSEL FOR THE ASSESSEE, ON THE OTHER H AND, VEHEMENTLY CONTENDS THAT IN EARLIER AND SUBSEQUENT YEAR THERE HA BEEN NO CHANGE IN THE METHOD OF ACCOUNTING FOLLOWED BY THE ASSESSEE. BESI DES, THE CONTENTION OF THE REVENUE THAT THE ASSESSEE ACCEPTED THE ORDER OF CIT(A) AND DID NOT CHALLENGE IT BEFORE THE ITAT IS NOT CORRECT. OUR AT TENTION IS INVITED TO THE IMPUGNED ITAT ORDER IN WHICH RELIEF WAS GRANTED TO ASSESSEE ON THE ISSUE OF 80-HHC, LEAVING NO TAX LIABILITY. SINCE THE ASSESSE E GOT THE RELIEF, THE ISSUE OF VALUATION OF STOCK BECAME INCONSEQUENTIAL. THE I TAT ORDER THERE CANNOT BE INTERPRETED AS ADMISSION OF ISSUE ABOUT CHANGE IN METHOD OF ACCOUNTING. CONSEQUENTLY, THE MISC. APPLICATION FILED BY THE D EPARTMENT AMOUNTS TO REVIEW OF ITAT ORDER, BESIDES NO MISTAKE IS COMMITT ED BY ITAT IN APPLYING THE RULE OF CONSISTENCY. 3 4. WE HAVE HEARD RIVAL CONTENTIONS. FROM THE PERUSA L OF THE ITAT ORDER IT DOES NOT EMERGE THAT ASSESSEE HAS ACCEPTED ANY C HANGE IN ITS METHOD OF ACCOUNTING AS IT GOT THE RELIEF IN TERMS OF SEC. 80 -HHC. THE ORDERS PASSED IN EARLIER AND SUBSEQUENT YEARS CLEARLY SUGGEST THAT T HE ASSESSEES METHOD OF ACCOUNTING WAS CONSISTENTLY ACCEPTED BY THE DEPARTM ENT EXCEPT THIS YEAR. IN VIEW THEREOF, WE HOLD THAT THE PETITION FILED BY TH E DEPARTMENT AMOUNTS TO REVIEW OF OUR ORDER, WHICH IS NOT PERMISSIBLE U/S 2 54(2). IN VIEW THEREOF, REVENUES PETITION IS DISMISSED. 5. IN THE RESULT, REVENUES MISCELLANEOUS APPLICATI ON IS DISMISSED. ORDER PRONOUNCED IN OPEN COURT ON 31-01-2012. SD/- SD/- ( K.D. RANJAN) ( R.P. TOLANI ) ACCOUNTANT MEMBER JUDICIAL MEMBER DATED: 31-01-2012. MP COPY TO : 1. ASSESSEE 2. AO 3. CIT 4. CIT(A) 5. DR 4