M/s. Silver Line,, New Delhi v. ACIT, New Delhi

CO 292/DEL/2010 | 2007-2008
Pronouncement Date: 30-09-2011 | Result: Partly Allowed

Appeal Details

RSA Number 29220123 RSA 2010
Assessee PAN AAKFS9650A
Bench Delhi
Appeal Number CO 292/DEL/2010
Duration Of Justice 1 year(s) 1 month(s)
Appellant M/s. Silver Line,, New Delhi
Respondent ACIT, New Delhi
Appeal Type Cross Objection
Pronouncement Date 30-09-2011
Appeal Filed By Assessee
Order Result Partly Allowed
Bench Allotted G
Tribunal Order Date 30-09-2011
Date Of Final Hearing 13-09-2011
Next Hearing Date 13-09-2011
Assessment Year 2007-2008
Appeal Filed On 30-08-2010
Judgment Text
IN THE INCOME TAX APPELLATE TRIBUNAL DELHI BENCH G DELHI BEFORE SHRI R.P. TOLANI AND SHRI K.G. BANSAL ITA NO. 3775(DEL)/2010 ASSESSMENT YEAR: 2007-08 ASSTT. COMMISSIONER OF INCOME M/S SILVER LINE TAX CIRCLE 31(1) NEW DELHI. VS. 18 BABAR ROAD BENGALI MARKET NEW DELHI. PAN- AAKFS9650A C.O. NO. 292(DEL)/2010 (ARISING OUT OF ITA NO. 3775(DEL)/2010) ASSESSMENT YEAR: 2007-08 M/S SILVER LINE ASSISTANT COMMISSIONER OF 18 BABAR ROAD BENGALI VS. I NCOME-TAX CIRCLE 31(1) MARKET NEW DELHI. NEW DELHI. (APPELLANT) (RESPON DENT) DEPARTMENT BY : SHRI NIRANJAN KAULI CIT DR ASSESSEE BY : SHRI R.K. GUPTA C.A. DATE OF HEARING : 15.09.2011 DATE OF PRONOUNCEMENT: 30.09.2011. ORDER PER K.G. BANSAL : AM IN THIS APPEAL THE REVENUE HAS TAKEN UP ONLY ONE GROUND THAT ON THE FACTS AND IN THE CIRCUMSTANCES OF THE CASE THE LD . CIT(APPEALS) ERRED IN DELETING THE ADDITION OF RS. 2 75 82 141/- MADE BY THE AO TO THE TOTAL INCOME OF THE ASSESSEE ON ACCOUNT OF EXCESSIVE AN D BOGUS PURCHASE. ON ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 2 THE OTHER HAND THE ASSESSEE HAS TAKEN UP THREE GROUNDS IN THE CROSS OBJECTION. GROUND NO. 1 IS TO THE EFFECT THAT TH E MANDATORY REQUIREMENT OF SECTION 127 HAS NOT BEEN FOLLOWED WHILE TRANSFERR ING THE JURISDICTION OF THE CASE FROM DEPUTY COMMISSIONER OF INCOME-TAX CIRCL E 31(1) NEW DELHI TO ADDITIONAL COMMISSIONER OF INCOME-TAX RANGE-31. IN GROUND NO. 2 IT HAS BEEN MENTIONED THAT THE APPEAL IS INCOMPETENT AN D NON-MAINTAINABLE AS IT HAS BEEN FILED BY ASSISTANT CIT CIRCLE 31(1) NEW DELHI WHILE IT SHOULD HAVE BEEN FILED BY ADDITIONAL CIT RANGE-31 NEW D ELHI. THESE GROUNDS HAVE NOT BEEN PRESSED BY THE LD. COUNSEL DURING TH E COURSE OF HEARING BEFORE US. THEREFORE THESE GROUNDS ARE TAKEN AS DISMI SSED. GROUND NO. 3 IS IN SUPPORT OF THE FINDING OF THE LD. CIT(APPEALS) THAT THE AO WAS NOT JUSTIFIED IN MAKING THE ADDITION OF RS. 2 75 82 141/- ON TH E GROUND OF ALLEGED EXCESSIVE AND BOGUS PURCHASE. THIS GROUND HAS DIRECT NEXUS WITH THE GROUND TAKEN BY THE REVENUE IN ITS APPEAL. THERE FORE THE TWO RIVAL GROUNDS SHALL BE DISPOSED OFF IN A CONSOLIDATED MANNER. 2. THE FACTS OF THE CASE ARE THAT THE ASSESSEE -FIRM FILED ITS RETURN ON 22.10.2007 DECLARING TOTAL INCOME OF RS. 3 00 20 090/-. THE RETURN WAS PROCESSED U/S 143(1) OF THE INCOME-TAX ACT 1961 ( THE ACT FOR SHORT). ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 3 THEREAFTER IT WAS TAKEN UP FOR SCRUTINY BY SERVIN G NOTICE U/S 143(2) DATED 19.9.2008 ON THE ASSESSEE. 2.1 THE ASSESSEE IS ENGAGED IN THE BUSINESS OF T RADING IN SILVER AND GOLD JEWELLERY AND PRECIOUS AND SEMI-PRECIOUS STONES . THE ASSESSEE DID NOT PRODUCE BOOKS OF ACCOUNT IN THE COURSE OF ASSESSM ENT. THE AO VERIFIED PURCHASES FROM 33 PARTIES BY ISSUING NOTICES U /S 133(6) OF THE ACT. 16 LETTERS WERE RECEIVED BACK UNSERVED FROM THE P OSTAL AUTHORITY MAKING THE REMARK THAT NO SUCH PARTY EXISTS AT THE GIVEN AD DRESS OR INCOMPLETE ADDRESS. THE ASSESSEE WAS REQUIRED TO SUBSTANT IATE THE CLAIM OF PURCHASE FROM THESE 16 PARTIES. IN RESPECT OF SLECTIVE GE MS GAURAV EXPORTS AND ANUPAM EXPORTS & IMPORTS IT WAS SUBMITTED THAT C ONFIRMATIONS IN RESPECT OF PURCHASE HAVE BEEN FILED. FURTHER IN RESPECT OF ALPANA GEMS & JEWELLERY VISION ENTERPRISES NATRAJ JEWELLERS SH REE ENTERPRISES SELECTION IMAGES SHUBH JEWELLERS TANISHQ ARTS AND AMAR GE MS IT WAS INFORMED THAT THE ADDRESS IS COMPLETE WHICH IS THE SAME AS FURNISHED BY THE VENDOR IN THE PURCHASE BILL. THE ADDRESS ON WHICH THE N OTICE U/S 133(6) WAS FORWARDED IS NOT KNOWN TO THE ASSESSEE. IN RESP ECT OF GEMS AND JEWELLERY SOURCE KRITIKA EXPORTS NAMAN GEMS AND GEM OCEAN IT WAS STATED THAT ABSENCE OF KNOWLEDGE OF THE PRESENT ADDRESS DOES NOT POINT TOWARDS ANY ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 4 FAULT OF THE ASSESSEE. IN THE CASE OF HARI OM EXPORTS IT WAS SUBMITTED THAT THE REMARK OF THE POSTAL AUTHORITY FOUND CLO SED PROVES THAT THE VENDOR EXISTS AT THE ADDRESS. THE TRANSACTIONS WERE UNDERTAKEN IN THE YEAR 2006-07 WHILE THE AFORESAID REMARK HAS BEEN M ADE IN THE YEAR 2009. COPIES OF ACCOUNT OF THESE PARTIES AS APPEARING IN THE BOOKS OF THE ASSESSEE AND THE BILLS RAISED BY THEM WERE ALSO FILED. IT WAS STATED THAT PAYMENT HAS BEEN MADE THROUGH CHEQUES AND THE GO ODS HAVE BEEN EXPORTED OUT OF INDIA. THE PROOF REGARDING EX PORT OF THESE GOODS WAS ALSO FILED. IN VIEW OF THESE FACTS IT WAS ARG UED THAT THE PURCHASES ARE GENUINE. THE AO CONSIDERED THE FACTS OF THE CA SE AND SUBMISSIONS MADE BEFORE HIM. HE MADE FURTHER VERIFICATION IN THE MATTER AND CHECKED UP THE VERACITY OF PANS SUPPLIED BY THE ASSESSEE FRO M THE PAN DATA. IT WAS FOUND THAT PAN AND ADDRESS DID NOT MATCH. THERE FORE IT WAS HELD THAT THE CONFIRMATIONS FILED BY THE ASSESSEE COULD NOT BE R ELIED UPON. ACCORDINGLY THE ADDITION OF RS. 2 75 82 141/- WAS MADE. 2.2 BEFORE THE FIRST APPELLATE AUTHORITY IT WAS SUBMITTED THAT THE BOOKS OF ACCOUNT HAVE BEEN MAINTAINED IN THE REGULAR C OURSE OF BUSINESS WHICH ARE SUPPORTED BY BILLS AND VOUCHERS. THE BOOKS H AVE BEEN AUDITED. TAX AUDIT REPORT HAS ALSO BEEN OBTAINED. THE AO HAS NOT NOTED ANY ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 5 DISCREPANCY IN THE SAME. THE PURCHASE BILLS IN RE SPECT OF 16 PARTIES CORRESPONDING EXPORT BILLS AND EVIDENCE OF ACTUA L EXPORT WERE PRODUCED BEFORE HIM. THE ASSESSEE ALSO FURNISHED CONFIRMAT ION IN RESPECT OF THE REMAINING 13 PARTIES. IT WAS FURTHER SUBMIT TED THAT THE GROSS PROFIT RATIO IN THIS YEAR AMOUNTS TO 24.21% WHICH IS HI GHER THAN 22.4% IN ASSESSMENT YEAR 2006-07 AND 19.62% IN ASSESSMEN T YEAR 2004-05. IF THE TRADING RESULT IS RE-CAST AFTER MAKING DISALLOWAN CE OF PURCHASE OF RS. 2 75 82 141/- THIS RATIO WILL BE 42.9% AND THE NET PROFIT RATIO WILL BE 39.05%. THIS IS NOT POSSIBLE IN THE LINE OF BUSINE SS OF THE ASSESSEE. THE FINDING REGARDING NON-PRODUCTION OF BOOKS OF ACCOU NT WAS ALSO CHALLENGED. IN THIS CONNECTION IT WAS SUBMITTED THAT THE BOO KS OF ACCOUNT WERE CALLED FOR VIDE QUESTIONNAIRE DATED 03.09.2009. THIS QUE STIONNAIRE WAS RESPONDED TO VIDE LETTER DATED 07.10.2009 IN WHICH IT HAS B EEN CLEARLY MENTIONED THAT THE BOOKS OF ACCOUNT ARE BEING PRODUCED. AN AFF IDAVIT OF THE ACCOUNTANT OF THE FIRM WAS FILED TO SUPPORT THE CONTENTION. THE BOOKS OF ACCOUNT WERE ALSO SOUGHT TO BE PRODUCED ON 29.12.2009 BUT THE ACCOUNTANT COULD NOT REACH THE OFFICE IN TIME. THEREFORE HE AGAIN ATTENDED OFFICE ON 30.12.2009 WITH BOOKS AND VOUCHERS WITH A REQUE ST TO THE AO TO EXAMINE THEM. HOWEVER THE AO INFORMED THAT SH E IS BUSY WITH SOME OTHER WORK. IN REGARD TO PAN IT WAS SUBMITTE D THAT THE FINDING OF THE ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 6 AO IS NOT CORRECT. WHILE BILLS WERE ISSUED IN THE NAME OF PROPRIETARY CONCERN THE PANS WERE ALLOTTED TO THE PROPRIET ORS IN THEIR INDIVIDUAL CAPACITY. THEREFORE THE OF PAN FROM THE DATA BASE DID NOT MATCH. HOWEVER THE PANS FURNISHED BY THE ASSESSEE ARE CORRECT. THE LD. CIT(APPEALS) FORWARDED ALL THESE MATERIALS TO THE A O FOR REMAND REPORT. IN RESPONSE THE AO SUBMITTED THE CHRONOLOGY OF H APPENINGS IN THE COURSE OF ASSESSMENT PROCEEDINGS. IT WAS FURTHER SUB MITTED THAT THE ASSESSMENT ORDER WAS FRAMED ON 30.12.2009 AND THEREFORE TH E AFFIDAVIT OF THE ACCOUNTANT IN REGARD TO ATTENDANCE ON 30.12.200 9 SHOULD NOT BE ADMITTED. HOWEVER NO SUBMISSION WAS MADE IN RESPECT OF AUTH ENTICITY OF THE PURCHASES MADE FROM 16 PARTIES AND THE CORRES PONDENCE SALES. THEREAFTER THE LD. CIT(APPEALS) HEARD THE ASSES SEE ON REMAND REPORT AND PROCEEDED TO DECIDE THE APPEAL. 2.3 COMING TO HIS FINDING IT HAS BEEN MENTIONED T HAT AFTER NON-SERVICE OF THE NOTICES THE ASSESSEE OBTAINED CONFIRMATIO N LETTERS FROM EACH AND EVERY PARTY. THESE CONFIRMATION LETTERS WERE ON THE LETTER-HEAD OF THE ASSESSEE AND IN THE SAME HANDWRITING THEREFORE THESE HAVE BEEN DOUBTED. 12 PANS OUT OF 16 PARTIES DID NOT M ATCH AND FOUR PANS WERE INVALID. HOWEVER THE ASSESSEE WAS NOT CONFRON TED WITH THESE FINDINGS IN ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 7 THE COURSE OF ASSESSMENT PROCEEDINGS. ACCORDING TO HIM THESE DEFICIENCIES ARE NOT ENOUGH TO DISALLOW PURCHASE S OF ABOUT RS. 2.75 CRORE OUT OF TOTAL PURCHASES OF ABOUT 10.2 CRORE. HE V ERIFIED PURCHASE AND SALE INVOICES IN RESPECT OF THE AFORESAID 16 PARTIES F ROM THE LEDGER CASH BOOK AND BANK PASS BOOKS. NO DISCREPANCIES WAS FOUND IN THE COURSE OF THIS EXAMINATION. THEREFORE IT WAS HELD THAT THE A SSESSEE HAS MAINTAINED BOOKS IN THE REGULAR COURSE OF BUSINESS. THESE BOOKS HAVE BEEN AUDITED. THE OBSERVATIONS OF THE AO ARE PROCEDURAL IN NAT URE AND DO NOT CAST ANY DOUBT ON THE VERACITY OF THE BOOKS OR PURCHASES F ROM 16 PARTIES. THEREFORE THE ADDITION HAS BEEN DELETED. 3. BEFORE US THE LD. DR SUBMITTED THAT THE AO HAD MADE VERIFICATION OF PURCHASES IN RESPECT OF 16 PARTIES. THERE WAS BELATED COMPLIANCE FROM THE ASSESSEE. THEREFORE THE AMOUNT INVOLVED IN TH E PURCHASES WAS DISALLOWED IN COMPUTING THE TOTAL INCOME. THEREAFT ER HE REFERRED TO THE FINDINGS OF THE LD. CIT(APPEALS). THE LD. CIT(AP PEALS) ADMITTED THE EVIDENCE AND OBTAINED THE REMAND REPORT. IT IS HIS CASE THAT SINCE THE AO DID NOT HAVE SUFFICIENT TIME IN THE COURSE OF ASS ESSMENT PROCEEDINGS THE MATTER MAY BE RESTORED TO HIS FILE FRO FRESH VERI FICATION OF THE PURCHASES. IT IS ALLEGED THAT THE BELATED COMPLIANCE WAS MAD E AS THE ASSESSEE DID NOT ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 8 WANT THE TRUTH TO COME OUT. THEREFORE IT IS ARG UED THAT EITHER THE ADDITION MADE BY THE AO MAY BE RESTORED OR THE MATTER MAY B E SENT BACK TO THE AO FOR FURTHER VERIFICATION. 3.1 IN REPLY THE LD. COUNSEL SUBMITTED THAT TH E GROSS PROFIT RATIO AND NET PROFIT RATIO FOR THIS YEAR ARE SIGNIFICANTLY HIGHER FROM EARLIER TWO YEARS. THE DETAILS ARE REPRODUCED BELOW:- PARTICULARS 2005-06 (RS.) 2006-07 (RS.) 2007-08 (IN APPEAL) RS. SALES 127351661.56 161660276.00 147497205.68 GROSS PROFIT 24522171.71 36760242.00 35711728.14 GROSS PROFIT(%) 19.26 22.74 24.21 NET PROFIT 19396673.28 31992683.63 30020084.88 NET PROFIT (%) 15.23 19.79 20.35 3.2 IN RESPECT OF VERIFICATION OF PURCHASES FROM 16 PARTIES AMOUNTING TO RS. 2 75 82 141/- IT IS SUBMITTED THAT IN ALL CASES CONFIRMED LEDGER ACCOUNT PURCHASE INVOICE CORRESPONDING EXPORT IN VOICE AND AIR BILL PAN CARD VAT REGISTRATION WERE FILED. STOCK REGISTER WAS ALSO FILED. THESE DETAILS HAVE NOW BEEN PLACED IN THE PAPER BOOK ON P AGE NOS. 25 TO 40 AND 121 TO 124 RESPECTIVELY. THE AO FOUND NO DISCRE PANCY EXCEPT THAT THE PANS DID NOT MATCH WITH PAN DATA BASE. THIS HA S BEEN EXPLAINED BEFORE ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 9 THE LD. CIT(APPEALS) AS NO OPPORTUNITY OF BEIN G HEARD WAS GRANTED BY THE AO IN THIS MATTER. 3.3 COMING TO THE ARGUMENTS IT IS SUBMITTED THA T THE FINDINGS OF THE AO ARE NOT SUSTAINABLE FOR VARIOUS REASONS. ALL THE PURCHASES ARE SUPPORTED BY PROPER VOUCHERS. CORRESPONDING EXPOR T INVOICES HAVE BEEN AUTHENTICATED BY CUSTOMS AUTHORITIES AND THE PAYME NTS HAVE BEEN RECEIVED BY WAY OF CROSSED CHEQUES. THE EXPORT PROCEEDS HAVE BEEN RECEIVED IN FOREIGN EXCHANGE THROUGH BANKING CHANNEL. CONFIR MATIONS HAVE BEEN FILED FORM ALL THE PARTIES. ALL OF THEM ARE ASSESSED T O INCOME-TAX AS WELL AS VAT. THE FINDING THAT ALL CONFIRMATIONS ARE IN T HE SAME HANDWRITING IS INCORRECT. THE FACT OF THE MATTER IS THAT THE A SSESSEE PREPARED LEDGER ACCOUNT ON ITS LETTER HEADS AND GOT ACCOUNTS C ONFIRMED THROUGH PERSONAL EFFORTS OF THE ACCOUNTANT. RELIANCE HAS INTER-A LIA BEEN PLACED ON THE DECISION IN THE CASE OF CIT VS. JMD COMPUTERS A ND COMMUNICATIONS (P) LTD. 180 TAXMAN 485 (DEL) IN WHICH IT HAS BEE N HELD THAT IF THE QUANTITATIVE DETAILS HAVE BEEN MAINTAINED IN RESP ECT OF PURCHASE AND SALE AND A COMPLETE STOCK TALLY IS FURNISHED IT CAN NOT BE ASSUMED THAT THE PURCHASES HAVE BEEN INFLATED. IN THE CASE OF YFC PROJECTS (P) LTD. VS. DCIT 134 TTJ (DEL) 167 IT HAS BEEN HELD THAT D ISALLOWANCE OF PURCHASES ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 10 MADE MAINLY DUE TO NON-FILING OF CONFIRMATION W HEN THE ASSESSEE HAS FILED CERTIFICATE FROM THE BANK INDICATING THE PAYMENT BY CHEQUE AND NO OTHER DEFECT HAS BEEN POINTED OUT IN THE BOOKS W ILL NOT BE JUSTIFIED. RELIANCE HAS ALSO BEEN PLACED ON THE DECISION IN THE CASE OF ITO VS. KANCHWALA GEMS 122 TTJ (JP) 854 IN WHICH IT HA S BEEN HELD THAT WHERE BILLS HAVE BEEN PRODUCED WHICH INDICATE THE DETAI LS OF GOODS RATE CST NO. PANS AND PAYMENT IS MADE THROUGH ACCOUNT PAYEE CHEQUE IN THE BUSINESS OF EXPORT WHERE EXPORTS HAVE BEEN CERT IFIED BY THE CUSTOMS AUTHORITIES THE PURCHASES CANNOT BE HELD TO BE BOGUS IN ABSENCE OF ANY POSITIVE MATERIAL ON RECORD. 3.4 IN THE REJOINDER THE LD. DR SUBMITTED THAT PURCHASES FROM 16 PARTIES ARE NOT GENUINE. 4. WE HAVE CONSIDERED THE FACTS OF THE CASE THE ORDERS OF THE LOWER AUTHORITIES AND THE CASES REFERRED TO IN THE MATTER. THE FACTS ARE THAT THE ASSESSING OFFICER ISSUED NOTICES U/S 133(6) TO 16 PARTIES WHICH WERE RETURNED BY THE POSTAL AUTHORITIES WITH THE REMAR KS WHICH HAVE ALREADY BEEN SUMMARIZED BY US. THE ASSESSEE WAS CONFRONT ED WITH THIS FACT. CONSEQUENTLY IT FILED CONFIRMED LEDGER ACCOUNTS FROM THE PARTIES. THE ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 11 AO FOUND DISCREPANCIES IN PANS. HOWEVER THIS F ACT WAS NOT CONFRONTED TO THE ASSESSEE FOR REBUTTAL. THE AO MADE THE DISAL LOWANCE OF A SUM OF RS. 2 75 82 141/-. IN THE COURSE OF HEARING BEFORE T HE LD. CIT(APPEALS) IT WAS SUBMITTED THAT THE BOOKS WERE PRODUCED ON TWO OCC ASIONS AND THE AFFIDAVIT OF THE ACCOUNTANT WAS FILED TO SUPPORT T HIS SUBMISSION. IT WAS FURTHER SUBMITTED THAT THE ASSESSEE HAS MAINTAI NED QUANTITATIVE DETAILS AND LINKAGES WERE ESTABLISHED BETWEEN PURCHASE S AND EXPORTS. THE EXPORT SALES WERE OBVIOUSLY EXAMINED BY THE CUSTOMS AUTHORITIES AND SALES PROCEEDS WERE RECEIVED THROUGH BANKING CH ANNEL. THE DISCREPANCY IN PANS WAS ALSO EXPLAINED BY SUBMITTING THAT WHIL E THE BILLS AND CONFIRMATIONS CARRIED THE TRADE NAME THE PANS W ERE ALLOTTED TO THE INDIVIDUAL. IN SUCH A SITUATION THERE WAS BOU ND TO BE DISCREPANCY BETWEEN THE QUOTED PANS AND THE PAN DATA BASE. ALL THIS MATERIAL WAS FORWARDED TO THE AO FOR REMAND REPORT WHO DID NOT POINT OUT ANY DISCREPANCY EXCEPT STATING THAT SUFFICIENT OPP ORTUNITY HAD BEEN GIVEN TO THE ASSESSEE IN THE COURSE OF ASSESSMENT. THE DI SCREPANCIES POINTED OUT BY THE ASSESSING OFFICER ARE NOT SUBSTANTIVE IN NAT URE AND DO NOT IMPINGE UPON THE VERACITY OF THE BOOKS OF ACCOUNT. THE L D. CIT(APPEALS) HIMSELF VERIFIED THE BOOKS AND VOUCHERS AND FOUND NO DISC REPANCY. THE BOOKS ARE ALSO AUDITED. IN SUCH CIRCUMSTANCES WE DO NOT F IND ANY JUSTIFICATION IN ITA NO. 3375(DEL)/2010& C.O. NO. 292(DEL)/2010 12 MAKING THE ADDITION OF RS. 2 75 82 141/-. AT THIS STAGE WE MAY ALSO MENTION THAT RE-CASTING THE TRADING RESULTS AFTE R DISALLOWANCE OF AFORESAID PURCHASES THE GROSS PROFIT RATIO AND THE NET PROFIT RATIO BECOME UNBELIEVABLY HIGH. EVEN IF THE AO WANTED TO RE JECT THE BOOKS OF ACCOUNT THE PROFIT HAD TO BE ESTIMATED ON A REASONABLE BASIS. THIS CAN BE DONE EITHER BY TAKING RECOURSE TO PAST RESULTS OR CITIN G COMPARABLE CASES. NO COMPARABLE CASE HAS BEEN CITED. THE RESULTS OF THI S YEAR ARE BETTER THAN THE RESULTS OF EARLIER TWO YEARS. THIS ALSO LEA DS TO A CONCLUSION THAT THE ADDITION MADE BY THE AO IS NOT SUSTAINABLE. THE VARIOUS CASES REFERRED TO ABOVE ONLY SUPPORT THE FINDING FURNISHED BY THE LD. CIT(APPEALS). ACCORDINGLY IT IS HELD THAT THE LD. CIT(APPEALS) WAS RIGHT IN DELETING THE ADDITION. 5. IN THE RESULT THE APPEAL OF THE REVENUE IS DI SMISSED AND THE CROSS OBJECTION OF THE ASSESSEE IS PARTLY ALLOWED. SD/- SD/- (R.P. TOLANI) (K.G.BANSAL) JUDICIAL MEMBER ACCOUNTANT MEMBER SP SATIA COPY OF THE ORDER FORWARDED TO:- M/S SILVER LINE NEW DELHI. ACIT CIRCLE 31(1) NEW DELHI. CIT(A) CIT THE DR ITAT NEW DELHI. ASSISTANT REGISTRAR.