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2018 (12) TMI 120 - AT - Income TaxAddition made on the basis of material collected at the back of the assessee - non giving an opportunity to assessee to rebut the same - violation of the principle of natural justice - Held that - We find considerable cogency in the contention raised by the assessee s counsel that addition was made on the basis of material collected at the back of the assessee without giving him an opportunity to rebut/cross examine the same, which was also raised before the Ld. CIT(A), who wrongly held that when the appellant has failed to appear before AO for the personal deposition u/s. 131 of the I.T. Act and now the assessee is claiming opportunity of cross examination and wrongly upheld the AO s order, which is not proper. Exactly on the similar facts and circumstances in the case of Smt. Jyoti Gupta vs. ITO 2018 (11) TMI 1353 - ITAT NEW DELHI wherein, the SMC Bench has considered the statement of Vikrant Kayan and has held that since the impugned addition was made on the statement of Sh. Vikrant Kayan without providing any opportunity to the assessee to cross examine the same and Ld. CIT(A) has not considered the same ground, which is in violation of principle of natural justice and against the law laid down in the case of Andaman Timber vs. CIT 2015 (10) TMI 442 - SUPREME COURT - Decided in favour of assessee.
Issues:
Appeal against order of Ld. Commissioner of Income Tax [Appeals] - Addition made without opportunity for rebuttal - Violation of principle of natural justice. Analysis: The appeal before the Appellate Tribunal ITAT Delhi was against the order of the Ld. Commissioner of Income Tax [Appeals] for the assessment year 2014-15. The primary issue raised by the assessee was the confirmation of an addition made without providing an opportunity to rebut the material collected, alleging a violation of the principle of natural justice. The assessee's case was selected for scrutiny, and the assessment was completed by the Assessing Officer at an income of ?44,68,790. The Ld. CIT(A) partly allowed the appeal, leading to the appeal before the Tribunal. During the hearing, the assessee's counsel argued that the addition was made without giving an opportunity for cross-examination, citing a similar case decided by the ITAT, SMC, Delhi Bench. The counsel highlighted that denial of cross-examination violated the principle of natural justice. The Departmental Representative relied on various case laws to support their argument. The Tribunal, after considering the submissions and relevant case laws, found merit in the contention raised by the assessee. It noted that the addition was made without providing an opportunity for rebuttal, which was a violation of the principle of natural justice. The Tribunal referred to a specific case where denial of cross-examination was deemed a serious flaw leading to nullity of the order. The Tribunal set aside the impugned additions, deleted the addition in dispute, and allowed the appeal of the assessee based on the law laid down by the Hon'ble Supreme Court of India. In conclusion, the Tribunal, following the precedent set by the ITAT, SMC, Delhi Bench and the Supreme Court of India, deleted the addition made without providing an opportunity for rebuttal. The appeal filed by the assessee was allowed, emphasizing the importance of adhering to the principle of natural justice in such matters. The judgment, pronounced on 29.11.2018, highlighted the significance of granting opportunities for rebuttal and cross-examination in assessments to uphold the principles of natural justice and ensure fair proceedings for the assessee.
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