Pr. Commissioner Of Income Tax, Delhi-1 v. M/S Asian Capital Services Ltd

$~16 * IN THE HIGH COURT OF DELHI AT NEW DELHI+ ITA 729/2018 PR. COMMISSIONER OF INCOME TAX, DELHI-1 ..... Appellant Through: Mr.Zoheb Hossain, Sr.Standing Counsel. versus M/S ASIAN CAPITAL SERVICES LTD. ..... Respondent Through: Mr.Ved Jain with Mr.Kislaya Parashar, Ms.Mekhala Benny & Ms.Umang Luthra, Advocates. CORAM: JUSTICE S.MURALIDHAR JUSTICE I.S.MEHTA O R D E R% 13.05.2019 1. The present appeal by the Revenue is directed against an order dated 21[st]December 2017 passed by the Income Tax Appellate („ITAT)‟ in IT (SS) No.22/Del/2013 for the block period 1989-90 to 1999-2000. 2. By the impugned order, the ITAT set aside the assessment order passed on 30[th] December 2011 by the Assessing Officer (AO) and remanded 5 issues to the AO for redetermination. The Court is informed that pursuant to the said remand order a fresh assessment order has been passed by the AO on 26[th] November 2018. 3. Relevant for the present appeal is the fact that of the 5 issues remanded by ITA 729/2018 Page 1 of 4 the ITAT to the AO for redetermination, the Revenue has questioned only remand in respect of 3 of the issues. Again, what is relevant is in respect of the 3 issues raised by the Revenue before this Court, 2 of the issues have been decided by the AO against the Assessee even after the remand. The net effect is that the Revenue can urge only one of the grounds as regards the remand made by the ITAT to the AO on one which is sought to be urged in question „A‟ of the present appeal as under: “Whether the Hon'ble ITAT was correct in restoring the issue on account of addition of unexplained expenditure based on seized document amounting to Rs. 25,43,192/- to the file of the AO despite the fact that the assessee failed to substantiate its claims despite several opportunities both before the AO as well as the CIT(A) wherein additional evidence was also admitted?” 4. Relevant to the above issue, the reasoning of the ITAT) in the impugned order remanding issue to the AO reads as under: “5.3 We have heard the rival submission and perused the relevant material on record. According to the assessee, the amount in dispute is outstanding debtors of M/s Rashiwa International Ltd. as on 05/12/1998, whereas according to the lower authorities, the assessee failed to explain with evidences that the amount in question is outstanding debtors of M/s Rashiva International Ltd. Before the Ld. CIT-(A), the assessee produced trial balance of M/s Rasiwa International Ltd. as on 05/12/1998 and general Ledgers of the parties appearing in the books of accounts of M/s Rashiwa International Ltd, however, the Ld. CIT-(A) observed that the claim of the assessee could not be reconciled with the documents submitted by the assessee. In our opinion, the trial balance dated 05/12/1998 and Ledger of parties, which were not audited by any Chartered Accountant, cannot be reconciled in isolation. The assessee was required to produce ITA 729/2018 Page 2 of 4 ITA 729/2018 Page 2 of 4 complete books of accounts and vouchers of M/s Rashiwa International Ltd., so that the Revenue Authorities could reconcile the name of the parties and amount appearing in page No. 6 of Annexure A-1 with the amount outstanding from the relevant parties as on 05/12/1998 in the books of accounts of M/s. Rashiwa International Ltd. Since this exercise of reconciling the amounts appearing in seized documents with tile books of accounts of M/s Rashiwa International Ltd. Has not been carried out by the lower authorities due to failure on account of the assessee and now before us the learned counsel has assured that all relevant documents shall be produced before the Assessing Officer, if matter is restored to the file of the Assessing Officer. In the circumstances, we are of the view that true facts should come on record for deciding issue-in~dispute judiciously. Thus the fact, whether the amounts appearing in page No. 6 of Annexure A-1 are outstanding debtors of M/s Rashiwa International Ltd., need to be examined thoroughly.” 5. We have heard learned counsel for the parties. It is seen that the ITAT remanded the matter to the AO was after examining the complete books of accounts and vouchers of M/s. Rashiwa International Ltd. asked to be produced by the Assessee. The ITAT was of the view that the exercise of reconciling the amounts appearing in the seized documents with the books of accounts of M/s.Rashiwa International Ltd. had to be actually carried out by the AO. That not having been done, due to failure of the Assessee, the matter required to be remanded to the AO. 6. The Court is, therefore, unable to accept the plea of the learned counsel for the Revenue before us that the ITAT had mechanically remanded the above issue to the AO for redetermination. ITA 729/2018 Page 3 of 4 7. Consequently, the Court is not persuaded that the impugned order calls for any interference. No substantial question of law arises. The appeal is dismissed. S. MURALIDHAR, J. MAY 13, 2019 tr I.S.MEHTA, J. ITA 729/2018 Page 4 of 4