In the a recent case (2009 -TMI - 33591 - DELHI HIGH COURT), honorable High Court of Delhi has observed that;

-      The responsibility for maintaining proper accounts rests exclusively with the petitioner.

-      This is not a case where the petitioner had either filed confirmation or made available the books of accounts maintained by St. Kabir Modern School and Holy Convent Senior Secondary School.

-      It is the petitioner's case that these books of accounts must be summoned by the Department.

-      This would indeed be a very dangerous precedent fraught with possibilities of harassment at the behest of the assessee, if, without any foundation the Department insists on a third party to produce its books of accounts.

-      It is this aspect of the case which has persuaded us not to exercise the extraordinary powers vested in us under Article 226 of the Constitution. Whether or not there has been an infraction of the Affiliation Bye-laws is altogether a different point.

 

(For full text of judgment - visit: 2009 -TMI - 33591 - DELHI HIGH COURT)

Duty to maintain accounts: department need not issue third-party summons at an assessee's request to obtain another's books. The court underscored that the duty to maintain proper accounts lies with the assessee and, absent confirmations or production of the third party books, the Department is not obliged to issue summons to third parties at the assessee's request; granting such requests without foundation risks harassment and does not warrant exercise of extraordinary writ powers to compel third party production, separate from any inquiry into affiliation bye law compliance.