9911796707
TMI Blog2004 (8) TMI 320X X X X Extracts X X X X X X X X Extracts X X X X ..... that the AO admitted there was no evidence concerning the rate of cash sales. AO issued summons to certain purchaser parties, and 12 parties appeared and confirmed the transactions. The Commissioner (Appeals) held that the non-availability of some purchasers could not lead to the conclusion that the assessee issued bogus bills. The assessee provided sufficient evidence to support the genuineness of its transactions. The assessee maintained complete books of account, including day-to-day and kilogram-to-kilogram stock registers, which were produced before the AO. The Commissioner (Appeals) found no mistakes in these records. The assessee also provided delivery challans, sales bills, and other documentary evidence to support the legitimacy of its business transactions. The Commissioner (Appeals) concluded that the transactions were genuine and not hawala entries. Conclusion: The Revenue failed to provide substantial evidence to support its allegations against the assessee. The Commissioner (Appeals) found the assessee's transactions to be genuine, supported by ample documentary evidence. The appeal of the department was dismissed, and the order of the Commissioner (Appeals) was c ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... , the assessee was found to have made sales of only Rs. 20.74 lakhs (48,479.150 kg) in areas outside Bombay. Sale of Rs. 4.46 crores (9,95,276.140 kg), i.e., the major portion of the sales, was found made to Bombay parties. The Assessing Officer issued summons to some Bombay parties, whose sales were more than of Rs. 3 lakhs, in order to investigate the genuineness of the assessee's sales. The parties were required to furnish the details of: (a) place of delivery; (b) transportation costs and by whom incurred; (c) octroi duty payments and by whom made; (d) prices at which they further sold the goods; and (e) their IT Nos. 5. The response has been classified by the Assessing Officer as under: (A) Parties not traced at addresses given by the assessee; (B) Parties served but avoided furnishing details; (C) Parties who furnished incomplete details. 6. The assessee was asked to produce the A and B category parties, lest sales to them be treated as hawala transactions. Vide letter-dated 3-1-1996, the assessee replied that it would amount to breach of trust upon the honest assessee, because the customers were not available after two years in a city like Bombay. The Assessing Officer w ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... at 5 per cent, amounting to Rs. 19,82,338. The total taxable income of the assessee was, hence worked out at Rs. 20,49,160. 11. In appeal, the assessee contended before the learned CIT(A), that it had produced before the Assessing Officer, complete quantitative details of purchases and sales, including quantitative stock records, invoices, octroi receipts, lorry receipts, bank statements, challans, stock registers, purchase bills, etc. The Assessing Officer did not find any discrepancies in the books of account of the assessee. Account-payee cheques made payments for purchases of material. The payments received by the assessee were also by account-payee cheques. Octroi payment towards purchases for receiving the goods in the godowns was confirmed by the Assessing Officer. Details of sales tax returns were filed before him. The observation that the Bhayander goods were sold in cash was incorrect and without basis. The customers while taking delivery ex-godown gave the addresses given in the sales bills. Various customers were Private Limited Companies and were regular customers. As per the Assessing Officer himself, the Category 'C parties furnished incomplete information. Rega ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ified; and that these parties confirmed that they had taken the deliveries of SS Pattas ex-godown of the assessee. 16. The Tribunal, vide order dated 17-6-1998, restored the matter to the file of the learned CIT(A), for passing a fresh order in accordance with law after examining the report of the Assessing Officer and other material available on record. The assessee was also to be afforded a reasonable opportunity of being heard. 17. The CIT(A) issued remand order dated 26-11-1998. It was observed that as per letter dated 18-11-1998, the Assessing Officer confirmed that no report dated 10-6-1997 was sent to the CIT(A)'s office. The Assessing Officer, however, did not furnish any comment on the specific issues. The learned CIT(A) spelt out the following specific issues requiring verification by the Assessing Officer: (i) Sales above Rs. 10 lakhs were made to three companies who could not be traced, namely, M/s. Jai Ambe Organic Export (P.) Ltd., M/s. Ashpon Impex (P.) Ltd. and M/s. Pinky Trading (P.) Ltd. Were these companies registered with the registrar of companies? What happened to their income-tax assessments? Any tangible evidence of hawala commission paid by them or any ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... sold the goods in cash at Bhayander has sold his bills to the hawala operators in Bombay. The cash generated at Bhayander has then been used to square off the cheques received from these hawala operators, after deducting a certain percentage as what is known in the market as hawala commission for providing a bogus 'entry' (i.e. hawala)'. This shows that the assessee is earning commission on providing entries to others, as he was not in need of hawala entries and as such he would not be required to pay commission to others. Thus, the view taken by the Assessing Officer is correct and as stated by the Assessing Officer in his assessment order, the estimation may not be 100 per cent correct. The Assessing Officer's estimation @ 5 per cent seems to be reasonable. (iii) The Assessing Officer has arrived at the conclusion that sale of goods from Mumbai is much more than the stock available in its godown. At the same time a low sale was declared from Bhayander godown, compared to the huge stock at Bhayander. The Assessing Officer has discussed this point at length in the assessment order and arrived at the conclusion that the assessee has sold the entire goods stored in B ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s received from these hawala operators, after deducting a certain percentage as what is known in the market as hawala commission for providing a bogus entry, i.e. hawala entry, showed that the assessee was earning commission on providing entries to others, as lie was not in need of hawala entries and as such, he would not be required to pay commission to others and that thus, the view taken in the assessment order was correct and reasonable in making estimation at the rate of five per cent. 22. From the above position, the learned CIT(A) observed that there was no tangible evidence to prove that the assessee has actually received hawala commission in connection with any sale transaction; that so, the Assessing Officer's view that the assessee earned hawala commission, and that too, over and above the profits of genuine trading in the same commodity, was based mostly on conjectures and surmises. 23. The learned CIT(A) noted the contention on behalf of the assessee, that a contrary more plausible inference was possible in this case. Assuming that in a competitive market, the assessee had to sell its goods to small scale manufacturers of stainless steel utensils, who were doing un ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the Assessing Officer himself, when he held that only the sales of 1,10,322 kg i.e., the goods available in the Bombay Godown, were held to have been genuinely made to Bombay Parties and the remaining sales of 8,84,958 kg to Bombay parties were held as hawala sales. 28. It was also held that the view taken by the CIT(A) in the case of M/s. Sarvottam Metals was applicable, more so, because unlike in that case, in the present assessee's case, there was no purchasing party who had admitted his purchases from the assessee to be sham or bogus. The assessee's case was also held be covered by the decision of the Hon'ble Bombay High Court in the case of R.B. Jessarain Fatehchand (Sugar Dept.) v. CIT [1970] 75 ITR 33. 29. Feeling aggrieved of the aforesaid order of the learned CIT(A), the department has filed the present appeal before us. The following effective ground of appeal has been raised: Whether on the facts and in the circumstances of the case and in the law, the learned CIT(A) erred in deleting the addition of Rs. 19,82,338 made by the Assessing Officer on account of hawala commission? 30. The learned Departmental Representative, Sh. Sanjay Rai, has pleaded that the ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... uring the Department rather than the assessee. 36. It is refuted that the Assessing Officer has not raised any dispute on the selling rates, as observed by the learned Commissioner of Income-tax (Appeals). It is contended that the Assessing Officer did point out the defects in the regular accounts of the assessee. It is submitted that there is a difference of Rs. 10 in the rate, on the same date. So, the rates are incomparable. Thus, the books of the assessee were rightly rejected by the Assessing Officer. No transport documents regarding movement of goods from Bhayander to Bombay are available. The delivery challans do not give details of delivery, registration numbers of trucks, quality of product sold or stock, etc. This suggests that physical delivery of goods is doubtful. Month-wise details are no indicator of cash sales. Attention is drawn to the Summary of Stock Movement of Bombay Godown for the period 1-4-1992 to 31-3-1993. It is submitted that curiously, no SS Patta was available, as on 31-3-1993. 37. Next, it is argued that the sales vouchers are not fully supported by delivery challans. Sale consideration received by cheque only proves financial movement and not actual m ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... med by M/s. Choudhary Metal Industries. There is no such confirmation from any of the other parties, other than from Ketan, which part y has been referred to in the assessment order. So, sales of Rs. 4 crores cannot be said to have been confirmed. The letter dated 18-10-1995 from the Chartered Accountant of the assessee to the Assessing Officer talks of 'stiff competition'. However, the picture appears to be otherwise, from the ledger accounts of the assessee. Out of the sales of Rs. 4.45 crores, the Assessing Officer treated transactions of Rs. 49.42 lakhs as genuine transactions. So, the Assessing Officer established a profit margin at the rate of five per cent. He computed Rs. 19 lakhs as the income of the assessee. 42. It has further been pleaded that the Sales Tax Order relied upon by the assessee is of no consequence whatsoever. It is, in fact, just a summary order like one passed under section 143(1)(a) of the Income-tax Act. 43. Also, it has been alleged that the sales the parties have verified and confirmed amount only to Rs. 39,930. 44. The learned Departmental Representative has stated that it is strange that the assessee has been receiving money in advance, wher ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... issioner (Appeals) did not take cognizance of the summons issued and he ordered the deletion of the addition made by the Assessing Officer on mere presumptions, which is not sustainable. 52. On the other hand, the learned counsel for the assessee, Sh. Shivram, has submitted before us that the impugned order passed by the learned Commissioner (Appeals) is well founded. It does not call for any interference at our hands. So far as regards the objection that there were defects in the books of account of the assessee, in the Statement of Facts filed before the learned CIT(A), and in the appeal proceedings, each and every observation of the Assessing Officer was replied to and proofs were furnished in support of such replies. Para-wise reply was filed to show as to how the observations recorded by the Assessing Officer were wrong. 53. Regarding the allegation that no detailed description of goods was contained in the sales bills, the learned counsel asserted that against all parties, delivery challans were made. The assessee deals only in one type of goods, id est, selling of SS Patta. All details as required by law are contained in the sales bills and challans. So, there has been no in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... assessee has submitted that bills were raised by the assessee in Bombay, because the parties were having their offices Bombay only, whereas the delivery was taken by them ex-Bhayander Godown. The basis of the working of 1,55,980 kilograms of goods has not been furnished. There are, in fact, no discrepancies at all. Even in the remand report, the Assessing Officer has staled that there is no evident against the assessee in this regard. The details of movement of stock have also been duly furnished. 58. Replying to the averment that the assessee never availed the opportunity offered to it to produce the parties, the learned counsel for the assessee has submitted that in response to the summons issued, as many as twelve parties appeared before the Assessing Officer and confirmed the transactions. 59. Next, responding to the contention that there are discrepancies in the stocks and the sales, the learned counsel has denied the existence of any such discrepancy. Mention has been made of the Summary of Stock Movement for the period 1-4-1992 to 31-3-1993, from the assessee Bombay Godown and its Bhayander Godown. This summary is stated t have been filed both before the Assessing Officer as ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... re hawala transactions. 63. Speaking of the assertion that not even a single party was produced before the Assessing Officer by the assessee, the learned counsel for the assessee would contend that this assertion is baseless. In fact, a perusal of the record would show that as many as twelve parties responded to the summons issued to them by the Assessing Officer and they duly appeared before him. All of them confirmed the impugned transactions entered into by the assessee. The said transactions, therefore, stood proved to be genuine transactions. 64. Apropos the contention of the Revenue that the beneficiary of those hawala transactions was Magnum Films, which was owned by detenues under the Terrorist and Disruptive Activities Act, namely, Samir Hingora and Hanif Kadawala, the learned counsel for the assessee has responded by stating that the assessee does not have anything to do with any such detenues. It has no connection with them, nor any knowledge about them. The charge has been wrongly levied sans any iota of proof. 65. Regarding the charge that the selling rates of the impugned transactions are not comparable, the learned counsel for the assessee has replied that the compar ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ries were taken by the customers ex-godown of the assessee, there arises no question of the lorry receipts or the dates pertaining thereto having been mentioned in the said delivery challans. Besides, all the sales bills are pointed out to have been serially numbered and it has also been stated that all the sales bills contain reference of all the respective delivery challans. The learned counsel for the assessee has further submitted in this regard that the assessee meticulously maintained duly audited books of account and all relevant details, as required under both the Income-tax Act and the Rules framed thereunder. 69. In response to the next averment made by the learned Departmental Representative, to the effect that the Sales Tax order which stands relied upon by the assessee, is a summary order, similar to an order passed under section 143(1)(a) of the Income-tax Act, the learned counsel for the assessee has submitted before us that a scrutiny order passed under section 33(3) of the Sales Tax Act, is not at all an order akin to an order passed under section 143(1)(a) of the Income-tax Act, as wrongly alleged. In fact, it is a scrutiny order, as the name thereof suggests, whi ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... land for the time being in force. It is entirely the decision of a businessman as to how he or it chooses to do business. There is no illegality involved in the said mode of the business of the assessee. The fact of the matter is that had the assessee not collected its payments in advance, it would have been well nigh impossible for it to recover the said payments, were the delivery of the material handed over to the purchaser parties first and the parties left with a free hand to make over the payments to the assessee thereafter. Rather, the assessee would have been saddled with numerous bad debts, which it would never have been able to recover, had it gone along with the course suggested by the Revenue. 72. Regarding the objection that the remand order did not contain any direction that summons be issued, the ld. counsel contends that this is not true. A direction had been issued to verify the genuineness of the transactions in question. Such verification can only be done by way of securing the presence of the purchaser parties by through issuance of summons and thereupon verifying the records of the purchasers. It was this course which was carried out by the Assessing Officer i ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ram and the same lot had been sold at the rate of Rs. 43.50 per kilogram, whereas at Bhayander, the material was purchased at the rate of Rs. 50 per kilogram and sold for Rs. 53 per kilogram, on the same date. Since there was a difference in the quality of the material sold, the rates were obviously different. 75. The learned D.R. has also pointed out that there were discrepancies in respect of the stock regarding three category 'C' parties, in the assessment order. It has been submitted that a difference of 1,55,980 kilograms was found to be existing. The assessee has taken the stance that the sales were made to these parties by the assessee and the deliveries were taken by these purchaser parties from the Bhayander and Bombay Godowns of the assessee. The assessee is in possession of all the delivery challans, which are duly serially numbered, separately with regard to each godown. In these respective challans, Bombay stands referred to as 'B.M.', whereas Bhayander has been mentioned as 'BHY'. The Department has failed to prove otherwise. Before the Assessing Officer, all these three purchaser parties confirmed in no uncertain terms that the deliveries had ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ng thereto by the purchasers, as opposed to the reverse trend canvassed to be followed by the present assessee, the learned counsel for the assessee has to state that the practice followed by it is true and correct. The assessee has been duly maintaining all the records which the law requires it to do. So far as regards this, the Department has been unable to prove the stance taken by the assessee to be false or untrue or even doubtful. It has not been disproved that in the absence of following the practice of receiving advance payment, the assessee would have found itself in doldrums. 77. It is contended by the learned counsel that the Assessing Officer has failed to produce even a single piece of evidence, either direct or indirect, to prove that the assessee received any hawala commission. All purchases stored by the assessee in its Bombay and Bhayander Godowns were fully supported by bills, delivery challans and transport documents. All details of month-wise purchases and sales, as well as details of stock movement from both the godowns of the assessee were duly furnished. The entire sales and purchases were fully vouched and the sales proceeds were received by the assessee in ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ld 1,55,985 kilograms of material from Bombay, without having brought material from outside Bombay. So, a conclusion was arrived at that the entire material available with the assessee at Bhayander had been sold off by the assessee in cash to small manufacturers of Bhayander, Thane and Vasai. Thereafter, the assessee had sold the sales bills with regard to the said alleged cash sales to hawala operators in Bombay. The Assessing Officer was of the view that the cash generated at Bhayander was used to square off the cheques received from hawala operators after deducting a certain percentage as hawala commission for providing bogus hawala entries. 80. To support the above findings, it has been asserted by the Department that there were specific defects in the books of account maintained by the assessee, which were categorically pointed out by the Assessing Officer. The assessee, in his letter dated 12-3-1999, addressed to the learned Commissioner (Appeals), stated that as per the Remand Report, dated 24-2-1999, of the Assessing Officer, there was no tangible evidence of any hawala commission having been received by the assessee. A specific question had been put to him while asking for ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ave acted with due diligence and honesty; if the customers are not traceable after a lapse of a period of three years from the transactions, the assessee could not be found fault with; non-availability of customers cannot be taken to be a circumstance working against the assessee, so as to bring its legitimate income to tax. With the said letter dated 12-3-1999, the assessee, in support of its claim, attached Photostat copies of pay-in slips and bank statements. The Commissioner (Appeals) was beseeched to verify from the said documents that the assessee had received payments from M/s. Ashpon Impex (P.) Ltd. only through Account Payee cheques. The copy of the accounts of M/s. Ashpon Impex (P.) Ltd., their pay-in slips and Bank Clearance Statement were highlighted. A Comparative Chart of the sales rates charged to M/s. Ashpon Impex (P.) Ltd. and those charged to other parties was enclosed. Further, it was asserted by the assessee in the aforementioned letter that the Assessing Officer, in his Remand Report, was unable to provide any ground for the baseless assumption that the assessee had fetched hawala commission at the rate of five per cent. The Assessing Officer merely endorsed th ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s, if customers were found to be not available, merely this circumstance could, by no means, be made the basis for considering the legitimate business carried on by the assessee as giving of hawala entries. 81. The Revenue has not been able to successfully controvert the above-said assertions of the assessee. No palpable tangible evidence has been brought on the record of the case by the Department to the effect that the sales proceeds received by the assessee for the sale of SS Patta by the assessee to its customers was, in fact, hawala commission fetched by it, camouflaged as such sale consideration. The Department has failed to make out any case of subterfuge or colourable device having been adopted at the hands of the assessee. The Assessing Officer, in his Remand Report, just reflected the observations contained in the assessment order, bereft of any supporting evidence, direct or circumstantial. The information collected by the inspector deputed for the purpose was not analyzed. It was just put across in its raw form, while simply endorsing the uncorroborated views expressed in the assessment order. Evidently, this resulted for the reasons that factually there was no solid ev ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... is further correct in asserting that the person giving a cheque would not also give commission to one requiring merely cheques against cash. Too, undisputedly, SS Patta is a commodity exigible to sales tax. The cheques received by the assessee were received for payment in consideration of sale of this commodity. This further lends credence to the case of the assessee. That apart, the assessee is found to be in possession of cogent documentary proof by way of octroi duty receipts and lorry transport receipts, etc., to support the contention that the assessee had expended not less than twenty-one lakh rupees. The Assessing Officer had found, vide his report dated 10-6-1997, the business of the assessee to be genuine. The Assessing Officer also himself admitted that he could not gather any evidence with regard to rate of the alleged cash sales. The stock tally of the assessee at both its godowns was also given. There was no discrepancy either at the Bhayander Godown, or at the Bombay one. With reference to the higher gross profit rate, if any, earned by any other assessee, no evidence could again be brought on the file. Rather, the Assessing Officer himself noted that the addition ha ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... on this score. 84. With regard to the assertion that the assessee did not offer any proper explanation concerning the sales made and that there was a difference in the stocks available with the assessee in Bombay and the sales made there, the learned Commissioner (Appeals) has correctly held that the delivery of goods could have been taken by the purchaser parties at Bhayander. 85. So far as regards the allegation that no proper explanation was offered by the assessee with regard to the sales made, that details of party-wise sales have been furnished by the assessee before both the taxing authorities, as certified. These are the contentions at pages 31 to 39 of the assessee's paper book. Also, the sales comparison for the accounting year ended on 31-3-1993 has also been filed. Besides, there is an order of assessment tax under section 33/35 of the Bombay Sales Tax Act, 1959, at pages 92 to 95 of the APB. 86. The comparative analysis of rates at which sales were made to M/s. Ashpon Impex Private Limited, vis-a-vis other parties, contains the following Note: Note: Rate is calculated here by dividing the gross amount of bill by the quantity of goods. This rate is exclusive of sal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... les realization has been made through bank channels. The stock tally was found to be correct. As many as 12 parties appeared in response to summons issued to them. They confirmed the transactions. The assessee cannot be put to prove a negative. It was for the department to substantiate and prove the allegation being levelled by it. This, however, has not been done. Even in the remand report, the Assessing Officer has stated that the sales were duly verified and found to be genuine. Since the purchases have been held to be genuine, the corresponding sales cannot, by any stretch of imagination, be termed as hawala transaction. So, this allegation of the department also falls flat. 89. Apropos the suspicion aired by the revenue that mere quantity of purchase came from the Bhayander Godown of the assessee as compared to that in its Bombay Godown, the stand of the assessee although, has been that although the bills were raised at Bombay, because the parties had offices at Mumbai, however, delivery was taken by the parties themselves ex-Bhayander Godown. Mumbai being the financial capital of the country, cost of real estate is high, due to which, mostly, the sales or administrative offic ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... d aside lightly as is proposed to be done by the department. No attempt has been made to disprove the forceful evidence led by the parties, replete with documentary evidence buttress their stand. 91. It is not the correct appreciation of the facts, when it is alleged on behalf of the department that only financial transactions and not material transactions of the assessee are documented. The assessee has produced on record cogent material documentary evidence in support of the sales made by it. These are in the shape of bills, and delivery challans etc. These documents contain the requisite details as per law. Moreover, all financial transactions of the assessee are not merely financial transactions. These are proof of the facts that the assessee while carrying on its business adopted the method whereby the payments were received through account payee cheques only. If the case as tried to be made out by the department is taken as correct, the assessee would not have accepted the payment of its sale proceeds through account payee cheques as this itself would directly incriminate it. The learned CIT(A) has applied judicial and judicious mind on this aspect of the matter while accepti ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ales tax order is not a summary order. It is a scrutiny order, as the language of section 33(3) of Bombay Sales Tax Act, 1959 explicitly suggests. 93. The allegations of the department that despite the remand order containing no direction to issue summons, the Assessing Officer chose to do so. The assessee is not blame-worthy on this count also. Firstly, in order to make the verification ordered, the Assessing Officer was right in issuing summons, as he did. In absence of this, no verification could have been done. Therefore, it can well be said that the summons issued were in accordance with the directions contained in the remand order. The procedure is well stated in the Act and the Assessing Officer was competent to issue summons. 94. The next allegation of the department is that there is no lorry receipt certifying the transfer or movement of material from Bhayander to Bombay. The assessee has produced on record the day to day and kilogram to kilogram stock tally maintained by it. The assessee does its billing in Bombay, but the deliveries are taken by the parties themselves ex-godown, i.e., Bhayander godown. This explains the alleged non-movement of stock from Bhayander to Bom ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... n, would insure itself against nonpayment from the purchaser. 98. It is well-settled by judicial precedent that additions cannot be made merely on assumptions or presumptions or surmises or conjectures. It is the burden of the Department to prove the correctness of such additions. In the following cases, the ratios are to the same effect: (i) K.P. Varghese v. ITO [1981] 131 ITR 597(SC); (ii) CIT v. A. Roman Co. [1968] 67 ITR 11(SC); (iii) CIT v. Calcutta Discount Co. Ltd. [1973] 91 ITR 8(SC); (iv) Umacharan Shaw Bros. v. CIT [1959] 37 ITR 271(SC). 99. It is also well-settled that when, in such like cases, a quantitative tally is furnished, even if purchasers are not available, no addition is called for. The following decisions are some cases on the issue: (i) Balaji Textile Industries (P) Ltd. v. ITO [1994] 49 ITD 177 (Bom.) (ii) Dy. CIT v. Adinath Industries [2001] 252 ITR 476 (Guj.) (iii) CIT v. M.K. Bros. [1987] 163 ITR 249 (Guj.) (Special Leave Petition has been dismissed) 99.1 Further, the decision of the Mumbai Tribunal in the case of ITO v. M/s. Shreshtha Metals Mumbai', for assessment years 1988-89 to 1990-91, co-authored by the Judicial Member, vide order dated 12-12-2 ..... 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