2001 (10) TMI 261 - AT - Income Tax

Summary

Issues:
- Appeal against order of CIT(A) for assessment year 1993-94
- Time-barred appeal by 11 days
- Deletion of Rs.60,147 as undisclosed income
- Violation of Rule 46A of IT Rules, 1962
- Power of first appellate authority under section 250(4) of Income-tax Act, 1961
- Case laws cited by both parties
- Consideration of additional evidence by first appellate authority
- Compliance with Rule 46A and principles of natural justice
- Decision to set aside CIT(A) order and remand matter to Assessing Officer

Analysis:
The appeal before the Appellate Tribunal concerned the deletion of Rs.60,147 as undisclosed income by the CIT(A) for the assessment year 1993-94. The Revenue's appeal was time-barred by 11 days, but a petition for condonation of delay was filed, which was accepted, and the appeal was admitted for hearing on merit.

The main issue in the appeal was the deletion of the amount by the CIT(A) based on additional evidence produced by the assessee. The Revenue contended that the evidence was in violation of Rule 46A of the IT Rules, 1962, which governs the admission of additional evidence. The Departmental Representative argued that the CIT(A) did not follow the procedure under Rule 46A and cited relevant case laws to support the contention.

On the other hand, the assessee's representative argued that the CIT(A) had the power to make further inquiries under section 250(4) of the Income-tax Act, 1961, and was not bound by the restrictions of Rule 46A. The representative also cited case laws to support this argument.

The Tribunal analyzed the contentions of both parties and emphasized the importance of complying with Rule 46A while considering additional evidence. The Tribunal noted that while the CIT(A) had the power to make further inquiries, the admission of additional evidence must adhere to the principles of Rule 46A. The Tribunal distinguished various case laws cited by both parties to clarify the applicability to the present case.

Ultimately, the Tribunal concluded that the additional evidence produced was in violation of Rule 46A and the principles of natural justice. As a result, the CIT(A) order was set aside, and the matter was remanded back to the Assessing Officer for fresh disposal, emphasizing the need for proper examination and decision-making in accordance with the law.

In conclusion, the Tribunal's decision highlighted the importance of following procedural rules and principles of natural justice while considering additional evidence in appeals, ultimately leading to the setting aside of the CIT(A) order and remanding the matter for further assessment.