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TMI Blog2012 (9) TMI 32X X X X Extracts X X X X X X X X Extracts X X X X ..... (A) has no power to find out new source of income which was not the subject matter of original assessment. If any part of the income has escaped assessment, it is the jurisdiction of the administrative CIT u/s 263 and not of CIT(A). In the impugned order, CIT(A) exceeded his jurisdiction and it appears that the orders have been framed by assuming the revisionary jurisdiction of Administrative Commissioner u/s 263 which is not permissible under the Act. Order of the CIT(A) passed u/s 250(4) is set aside and first appellate authority is directed to decide the appeals on merits. - IT(SS)A Nos.41 to 61/Ind/2011 - - - Dated:- 14-6-2012 - SHRI JOGINDER SINGH, AND SHRI R.C. SHARMA, JJ. Assessees by Shri Prakash Jain, CA Revenue by Shri Darshan Singh, CIT DR O R D E R PER JOGINDER SINGH, judicial member This bunch of twenty one appeals is by different assessees. During hearing, the ld. Counsel for the assessee did not press grounds 1 and 2 and the same are, therefore, dismissed as not pressed. The only grounds pressed are ground nos. 3 and 4 which are as under :- 3. That the order under appeal loudly speaks that ld. CIT(A) is determined to enhance the income but ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... ITR 909 (Bom); CIT vs. Chhaganlal Kailash Company; 148 ITR 7 (Mad); CIT v. Sardarilal Company; 251 ITR 864 (Del) (FB); CIT v. Union Tyres; 240 ITR 556 (Del); CIT vs. Associated Garments Markers; 197 ITR 350 (Raj.). The crux of arguments is that the learned CIT(A) is trying to use the revisionary powers available with the learned administrative Commissioner u/s 263 of the Act by passing an order u/s 250(4) of the Act which is not permissible as separate jurisdiction and powers have been enshrined in the Income Tax Act. A plea was also raised that the learned CIT(A) through the impugned order wants to add to the income of various assessees whose assessment orders have travelled upto CIT(A) and the Tribunal. It was pointed that the Tribunal has already decided those cases, therefore, the learned CIT(A) is not expected to sit over the decision of the Tribunal and has clearly crossed principle of judicial discipline. Our attention was invited to pages 1 to 8 of the paper book evidencing that the assessment orders of those assessees were either quashed by the earlier CIT(A) or deleted the addition which was confirmed by the Tribunal. Therefore, in the impugned order, the learned CIT( ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... icer had made detailed inquiry on the basis of appraisal report and made required additions in respect of incriminating documents found during search. After getting prior approval of Joint Commissioner of Income Tax, he assessed/re-assessed the income for the assessment years 1998-99 to 2004-05 under consideration. By directing the Assessing Officer to make further inquiries in the matter of income already assessed in the hands of other assessee relating to the present assessee, the learned CIT(A) has put the assessee to unnecessary harassment and litigation, which is not just and fair. We have also gone through the paper book containing assessment order, orders of the first appellate authority and of the Tribunal in the cases of other assessees whose assessments were again racked up by the CIT(A) directing the Assessing Officer make inclusion of such income in the assessments of the present assessees after making inquiries, which is not permissible under the scheme of the Act. On a query regarding allegation that the members of Gupta family earned unaccounted money as directors of M/s Siddhartha Tubes Limited, the ld. Counsel for the assessee invited our attention to the order of ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... or adding those income in the hands of present assessees. When no such direction was given by the Tribunal and the matter was decided by the Tribunal on merits, the proper forum of appeal against such order of the Tribunal is Hon ble High Court. Merely because the Tribunal has confirmed the order of the CIT(A) deleting the additions on merits, present CIT(A) is not empowered to propose addition of those income in the hands of the present assessees, more particularly when the Assessing Officer has considered all the relevant aspects while framing the scrutiny assessment orders of present assessees. Such assessments were framed not only after application of mind and making proper inquiries but also after getting the draft assessment orders duly approved by the competent authorities. So far as purchase of 5 acres of land of Dhar Kothi is concerned, it was explained that only a power of attorney to safeguard the property from encroachment and to maintain the property was entered and this fact can be verified from Sub Registrar, Indore, by further claiming that no payment was made by the assessee for the alleged purchase of this property. The ld. Counsel for the assessee with the help ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... orted by assessment orders, appellate order of CIT(A)/Tribunal and other documentary evidences as placed on record, we find force in the assertion of the ld. Counsel for the assessee. At the same time, it is worth mentioning here that Section 250(4) of the Income Tax Act confers wide powers on the learned Commissioner of Income Tax (Appeals) and his powers are much wider. But the learned CIT(A) is not competent to introduce new source of income in the assessment and as such his powers are confined to the subject matter of original assessment only. However, we are confined to present appeals only wherein the subject matter of appeal before the learned CIT(A) was the assessment and the scope of the appeal was limited to the subject matter only. The CIT(A) has no power to travel beyond the subject matter of the assessment and as such he is not entitled to direct the AO to introduce new sources of income and assess the same by passing order u/s 250(4) in the manner we see in case of present assessees. 4.2 We further find that the Hon ble Madras High Court in the case of CIT Vs. Chaganlal Kailas Co., 148 ITR 7 held as under:- The case before us is an a fortiori one. Even though a ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... s axiomatic that failure to prove the sources of investment will result in addition in the hands of the assessee under a different provision of law and will not have much relevance in the estimation of sales and gross profit rate adopted by the Assessing Officer. Any addition on account of unexplained investment would constitute a new source of income which was not the subject matter of assessment before the Assessing Officer, and, therefore, it was not open to the first appellate authority to direct the Assessing Officer to conduct enquiry regarding it. It is pertinent to mention here that the aforesaid decision of the Hon ble Delhi High Court was affirmed by the Full Bench of the same High Court in CIT vs. Sardarilal Company; 251 ITR 864. 4.3 So far as the decision from the Hon ble Gujarat High Court in CIT vs. Ahmedabad Crucible Company (206 ITR 574), relied on by the learned CIT DR, is concerned, we find that the Hon ble Gujarat High Court pronounced this decision on 15th June,1993 whereas the decision from Hon ble Delhi High Court in Union Tyres (supra) is of 23 rd December, 1999 which was affirmed by the Full Bench of the Hon ble Delhi High Court itself in Sardarilal ..... X X X X Extracts X X X X X X X X Extracts X X X X ..... by the ld. CIT (A) in the order passed u/s 250(4) have rightly been considered by the A.O. in the case of other assesses and the assessment orders of those assesses are either quashed by the predecessor CIT (A) or the additions were deleted by the Tribunal. As such, the learned CIT(A) is trying to add those items in the income of assesse without appreciating the fact that he has no power to find out new source of income which was not the subject matter of assessment in these cases. 6. If any part of the income has escaped assessment, it is the jurisdiction of the administrative CIT u/s 263 of the Act to invoke his revisionary powers to direct the Assessing Officer to include the income which has escaped assessment and not of the learned CIT(A). In this view of the matter also, the learned CIT(A) has clearly jumped over the jurisdiction of the administrative CIT, which deserves to be annulled, as the power of both the authorities have been separately enshrined in the Act. 7. If the arguments advanced by the learned respective counsels and the material available on record are kept in juxtaposition and analysed, we find that in the impugned order the learned CIT(A) has exceeded h ..... X X X X Extracts X X X X X X X X Extracts X X X X
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