COMMISSIONER OF INCOME-TAX Vs. HEYNON INDIA LTD.

JUDGEMENT

(1.) THE Revenue is aggrieved by an order dated September 22, 2006, passed by the Income -tax Appellate Tribunal, Delhi Bench H, New Delhi ('the Tribunal') in I.T.A. No. 3187/Del/2003 relevant for the assessment year 1998 -99. According to learned Counsel for the Revenue, the tax effect in this case on a notional basis is about Rs. 47.65 lakhs, although she does not deny that the assessee has been assessed at a loss. According to learned Counsel for the Revenue, deletion of additions made by the Assessing Officer (AO) will be carried forward to the subsequent years and may reduce the taxable income for those years. Therefore, according to her, the appeal may be entertained. Notwithstanding the fact that the tax effect is nil, we have heard the matter on the merits.

(2.) LEARNED Counsel for the Revenue has urged two issues. The first is with regard to the deletion by the Commissioner of Income -tax (Appeals) and the Tribunal of an addition of Rs. 54.46 lakhs made by the Assessing Officer on account of a discrepancy between the accounts of M/s Polar Industries Ltd. in the assessee's account and the accounts maintained by M/s Polar Industries Ltd. It appears that M/s Polar Industries Ltd. maintains one account of the assessee in its books of account, while the assessee maintains three different accounts -two under the head 'Sundry Creditors account' for FBD and Pump Division and one unsecured loan account.

(3.) ACCORDING to the assessee, the difference arose on account of the fact that the amount was debited by M/s Polar Industries Ltd. but a corresponding entry was not made by the assessee.