ITO, New Delhi v. M/s. Zara Trading (P) Ltd, New Delhi

ITA 3284/DEL/2009 | 2003-2004
Pronouncement Date: 26-02-2010 | Result: Allowed

Appeal Details

RSA Number 328420114 RSA 2009
Assessee PAN AAACZ1894Q
Bench Delhi
Appeal Number ITA 3284/DEL/2009
Duration Of Justice 7 month(s) 5 day(s)
Appellant ITO, New Delhi
Respondent M/s. Zara Trading (P) Ltd, New Delhi
Appeal Type Income Tax Appeal
Pronouncement Date 26-02-2010
Appeal Filed By Department
Order Result Allowed
Bench Allotted I
Tribunal Order Date 26-02-2010
Date Of Final Hearing 23-02-2010
Next Hearing Date 23-02-2010
Assessment Year 2003-2004
Appeal Filed On 21-07-2009
Judgment Text
ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 1 IN THE INCOMETAX APPELATE TRIBUNAL DELHI BENCH I: NEW DELHI BEFORE SHRI C.L. SETHI JUDICIAL MEMBER & SHRI SHAMIM YAHYA ACCOUNTANT MEMBER ITA NO. 3284/DEL/2009 A.Y. : 2003-04 ITO WARD-18(4) VS. M/S ZARS TRADING PRIVATE LIMITED R.NO. 248 C.R. BLDG. C-483 GROUND FLOOR NEW DELHI INDL. AREA LAWRENCE ROAD NEW DELHI (PAN: AAACZ1894Q) AND C.O. NO. 293/DEL/2009 (IN ITA NO. 3284/DEL/09) A.Y.. : 2003-04 M/S ZARS TRADING PRIVATE LIMITED VS. ITO WARD-18 (4) C-483 GROUND FLOOR R.NO. 248 C.R. BLDG. INDL. AREA LAWRENCE ROAD NEW DELHI NEW DELHI (PAN: AAACZ1894Q) (APPELLANT) (RESPONDENT) ASSESSEE BY : SH. SB GUPTA CA DEPARTMENT BY : SHRI ANUSHA KHURANA DR O R D E R PER SHAMIM YAHYA : AM THIS APPEAL BY THE REVENUE AND THE CROSS OBJECTION BY THE ASSESSEE ARE DIRECTED AGAINST THE ORDERS OF THE LD. CIT(A) FOR THE ASSESSMENT YEAR 2003-04. ITA NO. 3284/DEL/09 2. THE ISSUE RAISED IS THAT LD. CIT(A) IN DELETING THE ADDITION OF RS. 16 00 000/- MADE UNDER SECTION 68 OF THE IT ACT. ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 2 3. IN THIS CASE THE ASSESSEE COMPANY FURNISHED ITS RETRUN OF INCOME ON 20.11.2003 DECLARING AN INCOME OF RS. 3010/-. THE RETURN WAS PROCESSED UNDER SECTION 143(1). AO RECEIVED INFORMATION FROM THE I NVESTIGATION WING OF THE DEPARTMENT THAT ASSESSEE HAD TAKEN ACCOMMODATION EN TRIES TO THE TUNE OF RS. 16 LACS (RS. 4 LACS EACH) FROM 4 SPECIFIED COMPANIES. THESE AMOUNTS WERE FOUND CREDITED IN THE COMPANIES ACCOUNT MAINTAINED WITH T HE STATE BANK OF HYDERABAD KAROL BAGH NEW DELHI. ACCORDINGLY THE CASE WA S REOPENED. DURING THE COURSE OF ASSESSMENT. AO OBSERVED THAT ON GOING THROUGH T HE BANK STATEMENT OF THE COMPANIES FROM WHOM AMOUNTS HAVE BEEN RECEIVED BY T HE ASSESSEE COMPANY IT IS REVEALED THAT FROM THE FREQUENCY OF DEPOSIT/ WIT HDRAWAL REGULARLY IN A SHORT INTERVAL IT CAN BE INFERRED THAT THESE COMPANIES F ROM WHOM THE ASSESSEE WAS RECEIVED AMOUNTS ARE BEING USED FOR ROUTING ACCOMMO DATION ENTRIES. THE DEPOSITS IN THE BANK ACCOUNT ARE BY WAY OF CLEARING ENTRIES WHICH ARE IMMEDIATELY TRANSFERRED OUT. THE BALANCE IN THE AC COUNTS IS VERY LOW ON ANY DAY. ALL THE TRANSACTIONS ARE INTRA-DAY TRANSACTIONS WH ICH REFLECT THAT THE ACCOUNT IS JUST BEING USED TO ROUTE SUCH MONEY. THE MONEY DOES NOT STAY IN THE ACCOUNTS SO AS TO SUGGEST THAT IT HAD BEEN RECEIVED AS AND I NVESTMENT. SO IT IS CLEAR THAT THESE COMPANIES HAD NO ACTUAL BUSINESS AND HAD BEE N USED TO GIVE ACCOMMODATION ENTRIES. 3.1 AO ASKED THE ASSESSEE TO PRODUCE THE DIRECTORS OF THESE COMPANIES BUT NOBODY ATTENDED. HOWEVER THE ASESSEE HAS FILED T HE AFFIDAVITS FROM THE DIRECTORS OF THE ABOVE COMPANIES. THE ASSESSEE A LSO SUBMITTED THAT IN THE LETTER THAT THE LAW HAVE VESTED VERY WIDE POWER TO AO UND ER SECTION 131 OF THE IT ACT 1961 TO CALL THE WITNESSES TO CONFIRM THE TRANSACTI ONS SAME PLEASE BE USED AT THE COST OF THE ASSESSEE. AO OBSERVED THAT SINCE THE CLAIM OF THE ASSESSEE THAT ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 3 SHARE APPLICATION MONEY WAS OBTAINED THEREFORE I T IS THE DUTY OF THE ASSESSEE COMPANY TO SATISFY THE AO THAT CONDITION LAID DOWN UNDER SECTION 68 OF THE ACT ARE FULFILLED. AS ASSESSEE COMPANY FAILED TO D ISCHARGE ITS ONUS TO PROVE THE IDENTITY OF THE CREDITORS THE GENUINENESS OF THE T RANSACTIONS CREDITWORTHINESS OF THE CREDITORS THE AMOUNT OF RS. 16 LACS WAS ADDED TO THE INCOME OF THE ASSESSEE UNDER SECTION 68 OF THE IT ACT. 4. AGAINST ASSESSEES APPEAL LD. CIT(A) ELABORATE LY CONSIDERED THE ISSUE AND CONCLUDED AS UNDER:- 5.5. I HAVE GONE THROUGH THE CONTENTION OF THE AP PELLANT AS WELL AS THAT OF THE AO. IT IS NOT IN DISPUTE THAT DURING THE YEAR UNDER CONSIDERATION THE APPELLANT COMPANY HAD RECEIVED SHARE APPLICATION MONEY WHICH WERE ALL RECEIVED BY ACCOUNT PAYEE CHEQUES THE FACT WHICH I S NEITHER DENIED NOR CONFRONTED. IT IS ALSO NOT DIS PUTED BY THE AO THAT TOTAL AMOUNT OF RS. 16 LACS WAS RECEIVE D FORM THE COMPANIES WHICH ARE REGISTERED UNDER THE COMPANIES ACT WITH THE ROC. THIS FACT HAS ALSO NO T BEEN DENIED. FURTHER IN ALL OTHER CASES ALSO THE PA RTIES CONCERNED HAD INVESTED IN SHARE BY ACCOUNT PAYEE CHEQUES. THUS IT IS SEEN THAT IN SO FAR AS THE IDE NTITY OF THE PARTIES ARE CONCERNED THE SAME WERE ESTABLISHED SINCE THE PARTIES CONCERNED COULD BE VERIFIED FRO M INDEPENDENT SOURCES. IT IS IN THIS REGARD THE HONB LE JURISDICTIONAL HIGH COURT IN THE CASE OF DIVINE LEAS ING LTD. (SUPRA) HAS HELD THAT WHEN THE IDENTITY OF THE PER SON IS ESTABLISHED AND AMOUNT IS RECEIVED BY CHEQUE NO ADDITION SHOULD BE MADE IN CASE OF AMOUNT RECEIVED AS SHARE APPLICATION MONEY. THEIR LORDSHIP HAS FURTHE R OBSERVED THAT IT IS EVIDENT THAT EVEN IF IT BE ASS UMED THAT THE SUBSCRIBERS TO THE INCREASED SHARE CAPITAL WERE NOT GENUINE NEVERTHELESS UNDER NO CIRCUMSTANCES CAN THE AMOUNT OF SHARE CAPITAL BE REGARDED AS UNDISCL OSED ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 4 INCOME OF THE ASSESSEE. IT MAY BE THAT THERE ARE S OME BOGUS SHAREHOLDERS IN WHOSE NAMES SHARES HAD BEEN ISSUED AND THE MONEY MAY HAVE BEEN PROVIDED BY SOME OTHER PERSONS. IF THE ASSESSMENT OF THE PERSONS WHO ARE ALLEGED TO HAVE REALLY ADVANCED THE MONEY IS SOUGHT TO BE REOPENED THAT WOULD HAVE MADE SOME SENSE BUT WE FAIL TO UNDERSTAND AS TO HOW THIS AMOUNT OF INCREAS ED SHARE CAPITAL CAN BE ASSESSED IN THE HANDS OF THE COMPANY ITSELF. THE ADDITION OF RS. 16 LACS MADE O N THIS GROUND IS HEREBY DELETED. 5. AGAINST THIS ORDER THE REVENUE IS IN APPEAL BEFO RE US. 6. WE HAVE HEARD BOTH THE COUNSELS AND PERUSED THE RECORDS. THIS IS NOT A CASE OF SIMPLE SHARE APPLICATION MONEY. THE CASE IS THAT SHARE PREMIUM OF RS. 90/- HAS BEEN GIVEN ON APPLICATION OF SHARES OF RS. 10/- EACH. WE FIND THAT IN THIS CASE THE ASSESSEE HAS SUBMITTED THAT THE FOUR COMPA NIES HAD APPLIED FOR 4000/- EQUITY SHARES OF RS. 10/- EACH AT A PREMIUM OF RS. 90/-. IN THIS REGARD THE ASSESSEE HAS ONLY SUBMITTED AFFIDAVIT FROM THE DIR ECTORS OF THE COMPANY. THE AO REQUEST IS THAT THE DIRECTORS BE PRESENT WAS NOT FULFILLED. THOUGH THE ASSESSEE HAD SUBMITTED BEFORE THE AO THAT NECESSARY SUMMONS UNDER SECTION 131 MAY BE ISSUED. THE AO HAS NOT DONE SO AND CONC LUDED THAT ASSESSEE HAD FAILED TO DISCHARGE THE ONUS. UPON ASSESSEES AP PEAL LD. CIT(A) NOTED THAT IT IS NOT DISPUTED BY THE AO THAT AN AMOUNT WAS RECEIVED FROM COMPANIES WHICH ARE REGISTERED UNDER THE COMPANIES ACT WITH (ROC) AND T HE IDENTITY IS ESTABLISHED. IN THIS REGARD WE FAIL TO UNDERSTAND HOW THE CIT(A) H AS INFERRED THIS FROM THE ASSESSMENT ORDER. AO HAS VERY CLEARLY MENTIONED T HAT ASSESSEE HAS FAILED TO ESTABLISH THE IDENTITY OF THESE PERSONS. IT IS NOT THE CASE THAT THE ROC REGISTRATION CERTIFICATE FOR THESE COMPANIES; THEIR PAN DETAILS OR THEIR INCOME TAX RETURNS OR THEIR BALANCE SHEET SHOWING THE INVESTMENT WERE S UBMITTED BEFORE THE AO OR ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 5 CIT(A). UNDER SUCH CIRCUMSTANCES THERE WAS NO BA SIS ON WHICH THE IDENTITY OF THE COMPANIES COULD BE ESTABLISHED. LD. CIT(A) HAS RELIED UPON HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF DIVINE LE ASING LTD. WHEREIN IT WAS HELD THAT WHEN THE IDENTITY OF THE PERSONS IS ESTABLISHE D AND AMOUNT IS RECEIVED BY CHEQUE NO ADDITION SHOULD BE MADE IN CASE OF AMOU NT RECEIVED AS SHARE APPLICATION MONEY. SIMILAR PROPOSITION WAS LAID D OWN BY HONBLE APEX COURT IN THE CASE OF LOVELY EXPORTS WHEREIN THE APEX COURT H AS HELD THAT IF THE SHARE APPLICATION MONEY IS RECEIVED BY THE ASSESSEE COMPA NY FROM ALLEGED BOGUS SHAREHOLDERS WHOSE NAMES ARE GIVEN TO THE ASSESSIN G OFFICER THEN THE DEPARTMENT IS FREE TO PROCEED TO REOPEN THEIR INDIV IDUAL ASSESSMENTS IN ACCORDANCE WITH LAW BUT IT CANNOT BE REGARDED AS U NDISCLOSED INCOME OF THE ASSESSEE. 6.1 HERE WE FIND IN BOTH THE CASES THE HONBLE COUR TS HAVE LAID DOWN THE PROPOSITION ON THE PREMISE THAT THE IDENTITY OF THE PERSON IS ESTABLISHED AND THE AMOUNT IS RECEIVED AS SHARE APPLICATION MONEY. IN THE PRESENT CASE WE FIND THAT NO DOCUMENT HAS BEEN SUBMITTED TO ESTABLISH IDENTIT Y OF THE SHARE APPLICANTS. IT WAS ALSO NOT THE CASE OF SIMPLE SHARE APPLICATION M ONEY. RS. 10/- WORTH OF SHARES WERE PURPORTEDLY APPLIED FOR AT A PREMIUM OF RS. 90/- BY STRANGERS. NO JUSTIFICATION OR RECORD WHATSOEVER AS TO WHETHER THE COMPANIES CREDENTIALS COMMANDED A PREMIUM OF RS. 90 FOR SHARES OF RS. 10 IS ON RECORD. WE FIND THAT THE HONBLE APEX COURT IN THE CASE OF HONBLE APEX COURT DECISION IN THE CASE OF KAPURCHAND SHRIMAL VS. CIT 131 ITR 451 IT WAS HEL D THAT THE APPELLATE AUTHORITY HAS JURISDICTION AS WELL AS THE DUTY TO CORRECT THE ERRORS IN THE PROCEEDINGS UNDER APPEAL. HONBLE APEX COURT HAS FURTHER HELD THAT I N THE CASE OF DURGA PRASAD MORE 82 ITR 640 AND IN THE CASE OF SUMATI DAYAL (21 4 ITR 801) HAS OBSERVED THAT ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 6 THE AUTHORITIES SHOULD NOT PUT ON BLINKERS BUT SH OULD LOOK AT THE SURROUNDING CIRCUMSTANCES ALSO. 6.2 IN THE BACKGROUND OF THE AFORESAID DISCUSSION A ND PRECEDENT IN OUR OPINION THIS MATTER NEEDS TO BE REMITTED TO THE FI LES OF THE AO TO ENABLE HIM TO EXAMINE THE MATTER AFRESH. ACCORDINGLY THE MATTER IS REMITTED TO THE FILES OF THE AO. 6.3 IN THE RESULT THE REVENUE APPEAL IS ALLOWED FOR STATISTICAL PURPOSES. C.O. NO. 293/DEL/2009 7. IN THE CROSS OBJECTION THE ASSESSEE HAD PLEADED T HAT NOTICE ISSUED UNDER SECTION 148 IS ILLEGAL AND VOID AB INITIO AND IS T HEREFORE LIABLE TO BE QUASHED. IN THIS REGARD THE ASSESSEES SUBMISSION ARE AS UNDER: - THAT THERE WAS NO REASON TO BELIEVE THAT PETITI ONERS INCOME HAS ESCAPED ASSESSMENT WHICH IS MUST FOR ASSUMING LA WFUL JURISDICTION U/S 147 AND SUCH ABSENCE OF REASON TO BELIEVE IS E VIDENT FROM THE PLAIN READING OF THE REASON RECORDED WHICH DOES NOT CONTAIN EVENT HIS BASIC JURISDICTIONAL ELEMENT. THAT THE REOPENING CAN BE DONE ON THE BASIS OF RE ASON TO BELIEVE THAT INCOME HAS ESCAPED ASSESSMENT AND RECORDING OF REASON BEFORE THE ISSUE OF NOTICE U/S 148 IS MUST AS PER P ROVISION OF SEC. 148 WHICH IN THIS CASE HAS NOT BEEN RECORDED AND THUS B ASIC JURISDICTIONAL FACT IS MISSING IN THIS CASE THUS VITIATING THE ISS UE OF VALID NOTICE U/S 148. ALL THAT HAS BEEN RECORDED IN THE GARB OF THE PURPORTED REASON IS THE PROPOSAL TO THE ADDITIONAL CIT IN TERMS OF SEC. 151 WHICH IS DIFFERENT FROM THE REASON RECORDED AS PER THE DEC ISION OF HONBLE DELHI HIGH COURT IN THE CASE OF VINITA JAIN 212 C TR 45. REOPENING IS BARRED BECAUSE THE ASSESSING OFFICER HAD NO HIMSELF FORMED ANY BELIEF AS TO THE ESCAPEMENT OF INCOME BU T HE HAD MERELY ACTED UPON THE DIRECTION OF THE INVESTIGATION WING NEW DELHI ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 7 NOTICE UNDER SECTION 148 IS ILLEGAL BECAUSE THE NO TICE HAS BEEN ISSUED BASED UPON A GENERAL STATEMENT OF ONE PERSON THAT HE WAS DOING ONLY NAME LENDING 8. LD. COUNSEL OF THE ASSESSEE IN THIS REGARD HAS FURTHER PLACED RELIANCE UPON CIT VS. P.K. GUPTA (303 ITR 95) AND 212 CTR 45. LD . DR ON THE OTHER HAND HAS POINTED OUT THAT ORIGINAL ASSESSMENT IN THIS CASE WAS ONLY AN INTIMATION UNDER SECTION 143(1). HENCE IT WAS CONTENDED THAT THERE ARE NO FORMATION OF OPINION BY THE AO. IT WAS FURTHER SUBMITTED THAT THE REASONS RECORDED CLEARLY JUSTIFIED THE REOPENING AT THE STAGE OF RECORDING OF REASONS. TH E SUFFICIENCY OF THE REASONS IS NOT TO BE CONCLUSIVELY ESTABLISHED AT THIS STAGE. IN THIS REGARD RELIANCE WAS PLACED UPON HONBLE APEX COURT IN THE CASE OF RAJESH JHAVERI 291 ITR 500. 8.1 WE HAVE HEARD BOTH THE COUNSELS AND PERUSED THE RECORDS. WE FIND THAT ASSESSEE HAD ALSO RAISED THE ISSUE OF REOPENING BEF ORE THE LD. CIT(A). LD. CIT(A) HAS DISPOSED OFF THE ISSUE BY HOLDING AS UNDER:- FROM THE PLAIN READING OF SECTION 147 IT IS SEEN T HAT WHERE THE AO HAS REASONS TO BELIEVE THAT THE INCOME HAD ESCAPED TH E ASSESSMENT HE COULD ASSUME THE JURISDICTION U/S. 147 TO REOPEN THE ASSE SSMENT. IN THE INSTANT CASE UNDISPUTED FACT REMAINS THAT DURING THE YEAR UNDER CONSIDERATION THE APPELLANT HAD CREDITED SUM OF RS. 16 00 000/- IN ITS BOOKS OF ACCOUNTS AND AMOUNT RECEIVED AS SHARE APPLICATION MONEY. FU RTHER AS PER THE REPORT RECEIVED FROM THE DIT(INV.) DELHI IT WAS FOU ND THAT THE APPELLANT WAS A BENEFICIARY OF ENTRIES PROVIDED BY THE ENTRY PROVIDERS WHO HAD ADMITTED THAT THEY WERE MERELY AN ENTRY OPERATOR A ND WERE PROVIDING ENTRIES BY RECEIVING CASH FROM THE BENEFICIARIES A ND ISSUING CHEQUES IN RETURN. IT WAS ALSO REVEALED DURING SUCH INQUIRIES THAT PERSONS IN WHOSE NAMES SUCH ENTRIES WERE PROVIDED WERE PERSONS OF N O MEANS AND HENCE IT WAS UNDER THESE CIRCUMSTANCES THE AO HAD REASONS TO BELIEVE THAT INCOME HAD ESCAPED THE ASSESSMENT. THE WORDS ARE USED REAS ONS TO BELIEVE AND NOT THAT THERE IS A PROOF OF SUCH INCOME HAVING E SCAPED THE ASSESSMENT. IN THE INSTANT CASE THERE WAS INFORMATION IN THE HA NDS OF THE AO IN TERMS ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 8 OF REPORT OF THE DIT THAT THE APPELLANT WAS A BENEF ICIARY TO CERTAIN ENTRY TRANSACTIONS HE WAS RIGHT IN ASSUMING THE JURISDIC TION U/S 147. 8.2 LD. CIT(A) HAS HENCE CONCLUDED THAT SINCE THE I TO HAS IN HIS POSSESSION INFORMATION FROM THE INVESTIGATION WING RELYING O N THE JUDGEMENT OF THE HONBLE APEX COURT IN THE CASE OF ITO VS. PURSHOTT AMDAS BANGUR 224 ITR 362 HE WAS OF THE OPINION THAT ISSUE HAD RIGHTLY BEEN RE OPENED. 8.3 WE HAVE CAREFULLY CONSIDERED THE SUBMISSIONS. W E FIND THAT IN THIS CASE THE RETURN WAS PROCESSED UNDER SECTION 143(1). HONBLE APEX COURT IN THE CASE OF RAJESH JHAVERI CITED ABOVE HAS HELD THAT INTIMATION UNDER SECTION 143(1)(A) CANNOT BE TREATED TO BE AN ORDER OF REASSESSMENT. IT WAS HELD THAT THERE IS NO QUESTION OF FORMING OF OPINION IN SUCH A CASE AND THEREFORE NO QUESTION OF CHANGE OF OPINION CAN BE RAISED IN THIS REGARD. 8.4 SECTION 147 OF THE IT ACT MANDATES THAT AO HAS REASON TO BELIEVE THAT ANY INCOME CHARGEABLE TO TAX HAS ESCAPED ASSESSMENT FO R ANY ASSESSMENT YEAR HE MAY ASSESS OR REASSESS OF SUCH INCOME. NOW IN THI S CASE AO HAS INFORMATION FROM THE INVESTIGATION WING OF THE DEPARTMENT THAT ASSESSEE HAS TAKEN ACCOMMODATION ENTRIES TO THE TUNE OF RS. 16 LACS ( RS. 4 LACS EACH) AND THESE AMOUNTS WERE FOUND CREDITED IN THE COMPANIES ACCOUN TS MAINTAINED WITH THE SBI HYDERABAD KAROL BAGH NEW DELHI DURING THE PERIOD RELATING TO 2003-04. 8.5 IN THE ABOVE BACKGROUND THE AO HAS NOTED THAT THE ACCOMMODATION ENTRIES OBTAINED BY THE ASSESSEE ARE REQUIRED FOR V ERIFICATION OF IDENTITY OF THE PERSONS; CREDITWORTHINESS OF THE PERSONS; GENUINENE SS OF THE TRANSACTIONS. THEREFORE HE HAS REASON TO BELIEVE THAT THE INCOM E TO THE TUNE OF RS. 16 LACS HAS ESCAPED ASSESSMENT. HONBLE APEX COURT IN THE CASE OF (236 ITR 34) RAYMOND WOOLEN MILLS VS. ITO HAS HELD THAT REGARDING THE RE ASON FOR REOPENING THERE ITA NO. 3284 & CO NO. 293/DEL/09 A.Y. 2003-04 9 SHOULD BE PRIMA-FACIE MATERIAL THE SUFFICIENCY OR CORRECTNESS OF MATERIAL NEED NOT BE ESTABLISHED AT THE TIME OF RECORDING OF REAS ONS FOR REOPENING. HENCE IN OUR CONSIDERED OPINION OBJECTIONS FROM THE ASSESSEE REGARDING REOPENING ARE UNTENABLE. 8.6 LD. COUNSEL OF THE ASSESSEE HAS RELIED UPON THE HONBLE JURISDICTIONAL HIGH COURT IN THE CASE OF CIT VS. PRADEEP KUMAR GUPTA 30 3 ITR 95. THIS DOES NOT FRUCTIFY THE ASSESSEES CASE. IN THIS CASE IT WAS H ELD THAT IT WAS MANDATORY FOR REVENUE TO PRODUCE THE PROPRIETOR FOR CROSS EXAMINA TION BY THE ASSESSEE ON ITS SPECIFIC DEMAND IN THAT REGARD. THEREFORE THE RE OPENING WAS NOT JUSTIFIED. IT WAS FURTHER HELD THAT TAX EFFECT IN THAT CASE WAS B ELOW THAT FIXED BY THE CBDT FOR FLING APPEALS BEFORE HIGH COURT. 8.7 IN THE BACKGROUND OF THE AFORESAID DISCUSSION A ND PRECEDENT WE UPHOLD THE ORDER OF THE LD. CIT(A) HOLDING THE REOPENING AS VA LID. ACCORDINGLY THE CROSS OBJECTION FILED BY THE ASSESSEE IS DISMISSED. 9. IN THE RESULT APPEAL FILED BY THE REVENUE IS A LLOWED FOR STATISTICAL PURPOSES AND CROSS OBJECTION FILED BY THE ASSESSEE IS DISMISS ED. ORDER PRONOUNCED IN THE OPEN COURT ON 26/02/2010. SD/- SD/- [C.L. SETHI] [SHAMIM YAHYA] JUDICIAL MEMBER ACCOUNTANT MEMBER DATE: 26/02/ 2010 SRB COPY FORWARDED TO: - 1. APPELLANT 2. RESPONDENT 3. CIT 4. CIT (A) 5. DR ITAT TRUE COPY BY ORDER DEPUTY REGISTRAR ITAT DELHI BENCHES