TMI Blog2013 (12) TMI 244X X X X Extracts X X X X X X X X Extracts X X X X ..... The AO issued letters to various companies to know the holding in shares of those companies by the assessee in cases where the companies reported higher than the accounted holding - No evidence collected behind the back of the assessee could be used against the assessee unless an opportunity is given to the assessee to rebut the same. As the Revenue authorities have grossly erred in relying upon the evidences collected behind the back of the assessee, the additions based on such materials deserves to be deleted - Decided in favour of assessee. Interest expense - Held that:- Following assessee's own case for A.Y. 1996-97 - The issue was restored for fresh adjudication. - I.T.A. No. 8023/Mum/2011 - - - Dated:- 4-12-2013 - Shri Vijaypal Rao, JM And Shri N. K. Billaiya, AM,JJ. For the Appellant : Shri Vijay Mehta Shri Dharmesh Shah For the Respondent : Dr. P. Daniel ORDER Per N. K. Billaiya, AM:- This appeal by the assessee is directed against the order of the Ld. CIT(A)-40, Mumbai dt.14.11.2011 pertaining to A.Y. 1991-92. 2. The assessee has raised 13 substantive grounds of appeal. At the very outset, the Ld. Counsel for the assessee submitted that under in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... elevant fact and that books of account maintained on day today basis or at least regular basis are less, prone to manipulation. In the present case, as admitted, there was no regular maintenance of books of accounts. Belated drawings of the books after several years from the end of the accounting year are more damaging and cannot be relied upon. Correct and true income cannot be deduced from such a belated books of account." 5.3. The Ld. CIT(A) went on to rely upon the appellate order in the case of Late Shri Harshad S. Mehta A.Y. 1992-93 wherein it has been held that the books of accounts are liable to be rejected. The Ld. CIT(A) finally concluded that "I find the books of account produced by the appellant can be admitted as directed by the Hon'ble Tribunal but the same cannot be accepted as correct record of financial transaction of the appellant. Accordingly, the same is rejected as being unreliable and non verifiable." 6. Aggrieved by this, the assessee is before us. The Ld. Counsel for the assessee strongly contended that the Ld. CIT(A) ought to have accepted book results shown by the assessee. It is the say of the Ld. Counsel that the delay in drawing the books of account ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... one of the conditions for releasing them on bail was that they should not attempt to meet any of the prosecution witness including the employees and business contacts. The directors were given permission to attend the office of the assessee company only from 3.8.1993. At the same time, they were also required to be present on all days of the trial in the criminal matters. The assessee was given permission by CBI to look into the documents seized only on 1.3.1994 which date fell after the due date for compliance with the notice. In all a total of 377 cases appeal to have been pending against 15 companies of the Harshad Mehta group of which 15 were pending against the assessee company. The difficulty was compounded by the fact that the employees also left assessee's services on account of non-payment of salaries. It is also seen from the order of the Special Court dated 3.2.94 that no Chartered Accountant was willing to take up the audit of the assessee company's account. The documents seized from the assessee by the CBI have been listed in pages 97 to 116 of the paper book. Thus, all these details given in the paper book and also explained by the assessee before the CIT(A) show that ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... the decisions of the Tribunal [ supra ], we do not find any reason why the Ld. CIT(A) should have rejected the book results. As the admission of the books of account have attained finality by the decision of the Tribunal, the Ld. CIT(A) is directed to compute the income as per books of account. Ground No. 3 is allowed for statistical purpose. 10. Ground No. 4, 5 6 relate to the determination of the total income by considering net accretion to various assets. 11. As we have directed the Ld. CIT(A) to compute the taxable income as per books of account of the assessee qua in ground No. 3, additions contested for ground No. 4,5 6 are deleted. Ground No. 4 to 6 are accordingly allowed. 12. Ground No. 7 reads as under: "The Ld. CIT(A) has erred in law and in facts in confirming the determination of unaccounted investments as per annexure A-3 of the assessment order at Rs. 3,79,42,133/- on the basis of the information collected from various companies allegedly showing the shareholding of the appellant without appreciating that the copies of the said letters/information was neither provided to the appellant during assessment proceedings nor during remand proceedings." 13. Th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sallowance of deduction on account of interest expense claimed by the assessee. 18. Identical issue has been considered by us in ITA No. 9158/M/2010 in assessee's own case for A.Y. 1996-97 vide order dt. 29. 11.2013. Respectfully following the findings of the Tribunal in assessee's own case, this issue is restored back to the files of the AO to follow the directions of the Tribunal in A.Y. 2005-06 and 2006-07 as mentioned in ITA No. 9158/M/10 (supra). Ground No. 9 is allowed for statistical purposes. 19. Ground No. 10 relates to the disallowance of deduction of other expenses claimed by the assessee in the books of account. 20. As we have directed the CIT[A] to compute the income as per books of account of the assessee, all the expenses debited in the books of account will automatically be allowed by the AO as per our findings given in ground No. 3 of this order. Ground No. 10 is accordingly allowed. 21. Grievance raised vide ground No. 11 and 12 are consequential to our findings given for ground No. 3 of this appeal. As we have directed the AO to compute the income as per books of account of the assessee, these issues will be decided afresh. Ground No. 11 12 are accordin ..... X X X X Extracts X X X X X X X X Extracts X X X X
|
