TaxTMI 
TaxTMI 
2008 (11) TMI 218
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....assessment year 1997-98. The Revenue, being aggrieved by the impugned judgment, has primarily raised the following two issues in the appeal which, according to it, raises substantial questions of law: "(i) Whether the Tribunal had wrongly deleted the addition of Rs. 22,67,980 made by the Assessing Officer by disallowing the claim of depredation made by the assessee in respect of certain machinery items supplied by one Deepak Glycerides Process India (P.) Ltd.? (ii) Whether the Tribunal had erred in deleting an addition of Rs. 39,46,250 made by the Assessing Officer by disallowing the claim of the assessee in respect of expenditure made by the assessee on purchase of machinery on the ground that they were both outside the books of account ....
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....details, vide letter dated July 30, 1999. A perusal of the bills demonstrated that the eight items of machinery, in respect of which a query had been raised by the Assessing Officer had been purchased from one Deepak Glycerides Process (India) Pvt. Ltd. The assessee had claimed 100 per cent, depreciation on the eight items of machinery. The details of items on which the assessee had claimed 100 per cent. depreciation as given in the assessment order are as follows: Name of item Bill No. Date Amount H.P. Cylinder 262 3-9-1996 3,58,750 Temperature and Controllers 255 1-7-1997 49,610 Sensers -do.- -do.- 20,295 Air Heat Recovery Unit 250 22-6-1996 1,99,875 Dust Collector Water TA 249 22-6-1996 5,38,125 Heat Exchanger 2....
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....ss India (P.) Ltd., wherein as indicated above, he denied having supplied any goods except those which were mentioned in the two bills bearing numbers 239 and 242. In the context of this aspect of the matter, the Assessing Officer recorded the stand of the assessee wherein the assessee accepted the fact that the goods referred to in bill number 242 had been received by it. The assessee, however, claimed that the goods referred to in bill number 242 formed part of the bills bearing numbers 243 and 246, and were included in the sum of Rs. 1.24 crores, being the total purchases made for the factory and, hence, was expenditure which stood reflected in the books of account contrary to what the Assessing Officer had held. 9. The Assessing Office....
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....sessee towards supply of machinery were withdrawn in cash immediately after receipt of payments. The Commissioner of Income-tax (Appeals) was of the view that without any further evidence it could not be concluded that the money flowed back to the assessee. 11. As regards the other aspect with regard to the addition of unexplained expenditure, the Commissioner of Income-tax (Appeals) observed that the reliance placed by the Assessing Officer on bills Nos. 239 and 242 purportedly issued by the supplier revealed that they referred to the same challan numbers and GR numbers even though they bore different dates. 12. The Commissioner of Income-tax (Appeals) in fact accepted the stand taken by the assessee that the machinery mentioned in bill ....
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....l for the Revenue. After perusing the orders, we find that the Tribunal has correctly concluded as follows: (i) no reliance can be placed on the statements made by Shri Deepak Chauhan, managing director of Deepak Glycerides Process India (P.) Ltd. as the statements were inherently contradictory and unreliable; (ii) no opportunity was given to the assessee by the Assessing Officer to examine Shri Deepak Chauhan; (iii) even though the books of account for the relevant year were available, Shri Deepak Chauhan, managing director of Deepak Glycerides Process India (P.) Ltd. did not produce bills and vouchers by holding forth that same had been lost; (iv) two bills bearing Nos. 239 and 242, issued on two different dates, i.e., July 3, 1996, a....