2015 (6) TMI 1251 - AT - Income Tax

Admission of aditional evidences to CIT-A - Additional evidences submitted under Rule 46A before the CIT (A) but the CIT (A) has not admitted the same - HELD THAT - We find that the Tribunal has earlier restored the matter to the Assessing Officer for providing an opportunity of being heard to the assessee, however, the order was passed ex-parte. The assessee submitted additional evidences under Rule 46A before the CIT (A) but the CIT (A) has not admitted the same. We find from the order of the CIT (A) that the CIT (A) himself recorded that the evidences filed by the assessee goes to the root of the issues. In this view of the matter, we admit the additional evidences. Accordingly, we set aside the orders of the authorities below and restore the matter back to the file of the Assessing Officer to decide afresh after providing an opportunity of being heard to the assessee. It is ordered accordingly.

Summary

Issues:
Appeal against CIT(A) order - Admissibility of additional evidences under Rule 46A.

Analysis:
The appeal was filed by the assessee against the order of the Commissioner of Income-tax (Appeals) concerning the assessment year 2005-06. The CIT directed the Assessing Officer to make additions to the assessee's income on account of unexplained loans and share capital. The Tribunal upheld the CIT's order and sent the matter back to the Assessing Officer for a hearing. However, the Assessing Officer passed an ex-parte order without providing the assessee with an opportunity to be heard. The assessee submitted additional evidences under Rule 46A before the CIT (A) to establish the genuineness of the transactions, but the CIT (A) did not admit them. The CIT (A) acknowledged that the submitted evidences were crucial to the issues at hand, especially since the books of accounts were not produced during the original assessment. As a result, the Tribunal admitted the additional evidences, set aside the lower authorities' orders, and remanded the matter to the Assessing Officer for a fresh decision after providing a proper hearing to the assessee.

The key argument raised by the assessee's counsel was the failure of the Assessing Officer to provide a hearing opportunity before passing the ex-parte order. The counsel contended that no notice was served on the assessee, hence preventing their appearance. Additionally, it was highlighted that the additional evidences under Rule 46A were crucial in establishing the legitimacy of the transactions, which were not available during the original assessment process. The counsel emphasized that the CIT (A) erred in not admitting these evidences, which were fundamental to the case. On the other hand, the Revenue relied on the decisions of the lower authorities.

The Tribunal, after considering the submissions and reviewing the record, found that the Assessing Officer's ex-parte order was unjustified, especially since the assessee was not given a proper hearing opportunity as directed earlier. The Tribunal acknowledged the significance of the additional evidences in addressing the core issues of the case, particularly in the absence of produced books of accounts during the initial assessment. Consequently, the Tribunal admitted the additional evidences, overturned the decisions of the lower authorities, and remanded the case to the Assessing Officer for a fresh assessment after granting the assessee a fair hearing opportunity.

In conclusion, the appeal was allowed for statistical purposes, emphasizing the importance of providing a fair hearing opportunity to the assessee and admitting crucial additional evidences to ensure a just and thorough assessment process.