JUDGMENT 1. (Oral) - The only contention raised by counsel for the appellant assessee-company in challenging the order of the Income-tax Appellate Tribunal, Jaipur Bench, Jaipur, dated June 10, 2002, is that if the Tribunal is held to be justified in making the addition of Rs. 4,37,048 in the hands of the appellant-company, then the said amount could not have been taxed in the hands of the director Shri Mahesh Toshniwal as was done by the Commissioner of Income-tax (Appeals) and the Tribunal ought to have, to that extent, modified the order of the Commissioner of Income-tax (Appeals). 2. We are satisfied that the following substantial question of law arises in this appeal for consideration : "Whether the Income-tax Appellate Tribunal ought to have clarified in view of its order that the addition of Rs. 4,37,048 has to be made in the hands of the appellant-company that the said addition is not taxable in the hands of its director Mahesh Toshniwal as was done by the Commissioner of Income-tax (Appeals) ?" 3. The afore referred question arises in the facts and circumstances which may be briefly noticed by us immediately now. The appellant-company is a private limited company. The premises of the company were searched on January 8, 1993, and so also the residential premises of its director Mahesh Toshniwal. During the course of the search, the books of account of the company were seized which reflected purchases from five parties, namely, (1) M/s. M.P. Electronics Circuits Ltd., New Delhi ; (2) M/s. R. Prakash Plastics, Delhi ; (3) M/s. R.K. Electronics ; (4) M/s. Cosmos Systems and (5)M/s. Integral Electronics. The statement of Mahesh Toshniwal, one of the directors of the company, was recorded during the course of the search. His statement was also recorded under section 131 thereafter. In both the statements, he was not in a position to explain the source and expressed his willingness to surrender that amount for tax. 4. The Assessing Officer in his order dated December 26, 1994, observed thus : "7. From the statement of Shri Mahesh Toshniwal it is clear that purchases of Rs. 4,37,048 from the above mentioned five parties are not genuine. It is also accepted by him that the payment for the alleged purchases have been made, though the amount are shown outstanding in the books of account. From the statement of Shri Mahesh Toshniwal it is clear that purchases of Rs. 4,37,048 from the above mentioned five parties are not genuine. It is also accepted by him that the payment for the alleged purchases have been made, though the amount are shown outstanding in the books of account. Shri Mahesh Toshniwal has also not been able to give any evidence about the purchases from the other parties. There is no evidence about the quantum of money spent for such purchases. The alleged purchases from such unknown parties are totally un-vouched. Therefore, no deduction can be allowed to the assessee-company on account of the purchases of Rs. 4,37,048 from the above mentioned parties. Regarding the source of the alleged payment to unidentified parties, any evidence of such payments is not available. Though, the assessee has accepted that such payments have been made from unaccounted money but Shri Toshniwal, director of the assessee-company is not able to give any evidence that such unaccounted payments were made by him from his own funds. Therefore, as far as the claim of purchases from the above parties are concerned, the same are dis-allowable in the hands of the assesse-company as bogus purchases and added to the total income under the head 'Income from undisclosed sources'." 5. He, accordingly, added a sum of Rs. 4,37,048 in the income of the company from undisclosed sources. 6. The appellant-company challenged the order of the Assessing Officer in appeal before the Commissioner of Income-tax (Appeals). The Commissioner of Income-tax (Appeals) in his order dated March 20, 1995, noticed the two statements of Mahesh Toshniwal and observing that since no material was brought on record by the Assessing Officer to show that the appellant-company had utilised its own unaccounted money for making the purchases for the amount of Rs. 4,37,048, he deleted the said amount from the income of the appellant-company and directed the Assessing Officer to include the amount of Rs. 4,37,048 in the income of Mahesh Toshniwal for the assessment year 1991-92. This is what the Commissioner of Income-tax (Appeals) held in its order dated March 20, 1995 : "1.5 I have closely examined the statement of Shri Mahesh Tosh niwal and the other facts. The appellant had shown the five alleged sellers as creditors in the books of account. No payment was shown to have been made by the appellant to them. The appellant had shown the five alleged sellers as creditors in the books of account. No payment was shown to have been made by the appellant to them. The director, Shri Mahesh Toshniwal, in his two statements, claimed that the payment was made by him from his personal funds. No material was brought on record by the Deputy Commissioner of Income-tax to show that the appellant had utilised its own unaccounted money for making the purchases for the aforesaid amount of Rs. 4,37,048 in the case of the appellant is deleted. However, the Assessing Officer dealing with the case of Shri Mahesh Toshniwal is directed to include the said amount of Rs. 4,37,048 as his income for the period relevant to the assessment year 1991-92. Consequently, the appellant gets a relief of Rs,4,37,048." 7. The Revenue was aggrieved by the order of the Commissioner of Income-tax (Appeals) dated March 20, 1995, and preferred appeal before the Tribunal. The contention of the Revenue before the Tribunal was that the Commissioner of Income-tax (Appeals) erred in deleting the addition of Rs. 4,37,048, made on account of unexplained investment from the income of the company and directing the Assessing Officer to include the same in the hands of Mahesh Toshniwal. 8. The Tribunal considered the matter in paragraph 6 of its order thus : "6. We have carefully considered the rival submissions of the par ties, perused the material available on record and the decision relied upon by the learned Departmental representative. We find that as a result of search on the assessee-company, the purchases totalling to Rs. 4,37,048 were not found recorded in the seized books of account of the assessee-company. No surrender was made on behalf of the company by any of the directors of the assessee-company. The surrender was made by Shri Mahesh Toshniwal, one of the directors of the company in his individual capacity and not on behalf of the assessee-company and the same was considered in his personal assessment. Under the law, the company is a separate juridical per son. The surrender made by Shri Mahesh Toshniwal, in his individual capacity is not binding on the assessee-company. Shri Mahesh Toshniwal in his personal statements, has nowhere stated that the surrender was made on behalf of the assessee-company. Under the law, the company is a separate juridical per son. The surrender made by Shri Mahesh Toshniwal, in his individual capacity is not binding on the assessee-company. Shri Mahesh Toshniwal in his personal statements, has nowhere stated that the surrender was made on behalf of the assessee-company. We also find that even in the return filed in response to a notice under section 148, the assessee-company did not include the said amount of bogus purchases. The assessee-company has not placed any material as to show that the said purchases, in fact, belong to Shri Mahesh Toshniwal and not the assessee-company. Under these circumstances, we do not find any merit in the plea of the learned authorised representative that since the said amount of purchases has been added in the hands of Shri Mahesh Toshniwal, no addition can be made in the hands of the assessee-company. It is a settled law that the tax has to be levied on the real person. Under these circumstances and keeping in view the decision of the Hon'ble Delhi High Court as relied on by the learned Departmental representative in the case of CIT v. La Medica (2001) 250 ITR 575 , we are of the view that the assessee-company has debited bogus purchases in its books of account which the assessee-company could not substantiate and, accordingly, the Commissioner of Income-tax (Appeals) was not justified in deleting the addition of Rs. 4,37,048, which is directed to be reversed and added in the income of the assessee-company. Consequently, the addition made by the Assessing Officer amounting to Rs. 4,37,048 is upheld. The ground taken by the Revenue, is therefore, allowed." 9. The Tribunal, thus, by its order dated June 10, 2002, set aside the order of the Commissioner of Income-tax (Appeals) and restored the addition of Rs. 4,37,048 in the hands of the appellant-company as was done by the Assessing Officer. 10. In so far as the addition of Rs. 4,37,048 in the hands of the appellant company is concerned, we are satisfied with the reasons given by the Tribunal in paragraph 6 of its order. The addition of the amount of Rs.4,37,048 in the hands of the appellant-company cannot be said to be unjustified. The surrender of that amount for tax by its director Mahesh Toshniwal in his individual capacity had no legal sanctity. The addition of the amount of Rs.4,37,048 in the hands of the appellant-company cannot be said to be unjustified. The surrender of that amount for tax by its director Mahesh Toshniwal in his individual capacity had no legal sanctity. As a matter of fact, counsel for the appellant-company in the light of the facts noticed by the Tribunal did not challenge that finding. The grievance of the appellant-company is limited and that grievance is that the amount of Rs. 4,37,048 having been added to the income of the appellant-company, the said amount has to be deleted from the income of Mahesh Toshniwal; the same amount could not have been taxed twice in the hands of the appellant-company as well as its director. 11. Ms. Parinitoo Jain, counsel for the Revenue did not dispute the position that the same amount could not be taxed in the hands of the director of the company once it has been added to the income of the appellant-company. She was, therefore, not averse to the clarification being made by us to that extent. 12. We hold that the Income-tax Appellate Tribunal having made the addition of Rs. 4,37,048 in the hands of the appellant-company, it ought to have ordered deletion of that amount from the income of Mahesh Toshniwal. The order of the Commissioner of Income-tax (Appeals) must have been set aside by making this position very clear. We answer the question accordingly. 13. Consequent upon what we have said above, we clarify that the order of the Commissioner of Income-tax (Appeals) dated March 20, 1995, stands set aside to the extent the addition of Rs. 4,37,048 has been made in the hands of Mahesh Toshniwal. To avoid the multiplicity of litigation, we further observe that the Income-tax paid by Mahesh Toshniwal on the said amount of Rs. 4,37,048 shall be refunded to him. 14. The appellant-company shall discharge its tax liability as per the order of the Assessing Officer without any delay. The appellant-company shall, however, be at liberty to apply to the Central Board of Direct Taxes for waiver of interest. We observe that if such application is made, the Board shall consider the same in accordance with law and pass appropriate order thereon. 15. The parties shall bear their own costs. *******