2016 (5) TMI 860 - HC - Income Tax

Admission of additional evidence by ITAT - Held that - When Rule 18(4) is read with Rule 29 of the aforementioned Rules, there would not be any difficulty in holding that in terms of Rule 29, the additional evidence can also be produced before the Tribunal. In this view of the judgment rendered by this Court earlier in the aforementioned case, the first objection of the learned counsel for the appellant may not detain us any further. Insofar as the fact as to whether it is the assessee who has commissioned the Chartered Engineer and secured a report or the purchaser of the sale indulged in by the assessee who commissioned a Chartered Engineer, also may not be really relevant. It is now for the assessing authority to apply his mind independently as to whether for upholding the claim of the assessee that it has indulged in slump sale or not, the same is required to be examined and answered. For that very purpose, the Tribunal has remanded the matter for consideration afresh. As a matter of rule of prudence, whenever an appellate forum remands a case back for consideration afresh, the primary authority or the original authority has to proceed afresh in the matter by treating the same as a clean slate basis. Now, for achieving that objective, the appellate forum could be recording a statement that uninfluenced in any manner by the observations contained in the remand order, the matter be decided afresh . Not that its absence would make any difference when every quasi-judicial or judicial authority is required to decide a question afresh, he has to independently apply his mind to the facts and circumstances of the case and the materials available on record. But however, to put the matters beyond any pale of doubt, we proceed further and clearly make an observation by saying that the assessing authority shall now proceed further in the matter without in any manner being influenced by the observations contained in the order of remand passed by the Tribunal. Opportunity of leading evidence afresh to the assessee, denied - We find that no such attempt was made by the Tribunal and it has not been done either. Therefore, the assessing authority will provide a fair and reasonable opportunity to the assessee to produce any evidence, all the more so, to the contra, insofar as the additional evidence let in by the Department/Revenue and consider the same before taking a final decision in the matter

Summary

Issues:
1. Admissibility of additional evidence by the Tribunal
2. Ownership of the Chartered Engineer report
3. Opportunity for leading evidence by the assessee

Admissibility of Additional Evidence:
The appellant challenged the Tribunal's decision to admit additional evidence, arguing it was erroneous. The Division Bench of the Court previously ruled that Rule 29 allows for the production of additional evidence before the Tribunal. Therefore, the Tribunal's admission of additional evidence was deemed valid based on the Court's past judgment.

Ownership of Chartered Engineer Report:
The ownership of the Chartered Engineer report, whether commissioned by the assessee or the purchaser, was considered irrelevant. The assessing authority was tasked with independently determining if the sale qualified as a "slump sale." The Tribunal's remand required a fresh examination, emphasizing the need for an unbiased reevaluation. The Court further directed the assessing authority to proceed without influence from the Tribunal's remand order.

Opportunity for Leading Evidence:
The Court noted that the Tribunal did not afford the assessee an opportunity to present evidence, particularly in response to the additional evidence submitted by the Revenue. As a result, the assessing authority was instructed to provide a fair chance for the assessee to introduce evidence, including addressing the newly submitted materials. The case was disposed of with no costs.

Conclusion:
The judgment addressed the issues of admissibility of additional evidence, ownership of the Chartered Engineer report, and the opportunity for the assessee to present evidence. The Court upheld the Tribunal's decision to admit additional evidence, clarified the irrelevance of the report's ownership, and emphasized the need for a fair opportunity for the assessee to lead evidence. The assessing authority was directed to reevaluate the case independently and without influence from the Tribunal's remand order.